Research On Credit Default Behavior And Risk Prevelltion Of SMEs Based On Commercial Bank

The development of SMEs has been troubled by the fact that the credit granted and the contribution to economic growth unmatchable, mainly due to the high credit default ratios. Facing the development of SMEs and the challenges of globalization and drawing on international experience, the paper explores and researches credit default behavior from the theoretical and empirical point of view.Based on credit default definition, applying theory of business value, soft budget constraints, incomplete contract theory, game theory and asymmetric information theory, combining with the methods of empirical analysis and theoretical argument, qualitative and quantitative analysis. Microscopic and mathematical analysis, the paper constructed a framework of SMEs credit default behavior, analyzed the relationship between macroeconomic environment, legal and credit systems, soft budget constraints, asset size. SME’s quality and SME. Credit default with a discrete-time hazard model.Research and conclusion showed that unlimited company’s default rate is higher than that of limited due to soft budgetary and governance structure reasons, the nature of business affects SME’s default rate; larger-scale companies have the advantages of market, talent, capital and technology compared with small-scale company, and the default rate is small and the ability to resist risks is higher; public utilities and manufacturing are of lower default rates compared with real estate and commercial sectors, different sectors faced with different default probabilities; return on equity, asset turnover ratio, quick ration, liquidity ratio and operation capacity are inversely related to SME’s default probability; collateral rations and corporate mortgage are positively related to corporate loan default probability which reflects the risk-bearing capacity of investment; legal and macroeconomic environment affect SME’s default probability, such as GDP and income per capita.Finally the paper summarized the measures that the commercial banks, government and SMEs itself should take to disperse credit default risk. It contains the enlargement of human capital and information input, the implementation of relationship lending, creating a favorable external environment, establishing social credibility mechanism for SMEs. It is tripartite cooperation of SMEs, commercial banks and government, and then the credit default risk can be controlled effectively.