Commercial Bank Inventory Financing Risk Evaluation And Control

Inventory financing business can not only makes the small and medium-sized enterprises sunk cost became cash flow, but also can makes the banks to expand financing amount and gain a new profit point of growth in today's white-hot market competition situation. Therefore, further research on inventory financing business has very important practical significance today.After the current banks several basic inventory financing modes are being briefly introduced, and the foreign and domestic inventory financing business practice and theory research status are being carefully summarized, this article indicates that we need to target specific inventory financing model to improve its relevant risk assessment and management strategy.Commercial banks are facing two important problems in the specific inventory financing business, which is how to assess the risk and set optimal financing ratio before commencement of the business. This paper presents a relatively complete inventory financing risk evaluation index system which is based on several authority literatures. After application of SPSS statistic software to undertake index reduction, we use Logistic model to get the fitting coefficients of the final major indicators, and then through a specific example to introduce how to apply this method to evaluate inventory financing risks. While facing how to set the key variables in the inventory financing business, risk averse and risk preference for two scenarios were deeply discussed, and finally this paper draws two important inferences: In the case of risk preference and risk averse, former optimal inventory financing ratio is bigger than the latter; In risk preference scenario, if all the inventory could be able to successfully sold and the enterprise meet some conditions, both banks and enterprises could get benefits in inventory financing business.Finally, according to the critical variables setting status and some relevant risks, this paper gives three kinds of daily supervision index, and proposed a set of risk monitoring and early warning system.