Impairment Of Assets Of Commercial Banks' Risk Rating Under The New Accounting Standards

On February 15, 2006, Ministry of Finance officially issued the new Enterprise Accountant Criterion. And the change of the provision for impairment of assets is a major characteristic. Speaking of the banking industry, the change of the provision for impairment of assets will be able to have the huge influence for the bank risk management. At present, commercial banks rate their conditions of the capital adequacy, the property quality, the management level, the fluidity and the profit ability according to the "the Risk Rating System of the Joint-stock Commercial Banks". Does the new provision for impairment of assets have the influence on the risk rating system of the Joint-stock commercial banks? How to perfect the risk rating system of the joint-stock commercial banks?By using the method of theoretical analysis, we try to find weather the change of the provision for impairment of assets will have the influence on the the risk rating system of the commercial banks. First, definite the banks and the rating indexes on which we do research. Secondly, compute the rating indexes under the old Enterprise Accountant Criterion and the International Enterprise Accountant Criterion. And find out the amount of the provision for impairment of assets of the 2 Enterprise Accountant Criterions. Thirdly, using the relevant analysis to find out the relationship between the the difference of the rating indexes and the difference of the amount of the provision for impairment of assets.Finally, use Shannon information theory to build a new model to rate the Risk of the Joint-stock commercial banks. Then use this model to evaluate the total risk condition of the banks from 2003 to 2005.