Study On Financial Risk Based On Extension Method For The Credit Cooperatives Of X County

Finance is the core of modern economy, and the Bank is the financial core. As a special enterprise engaged in money and credit business, risk is inherent for rural credit cooperatives. So, whether it is in the financial field or in the management of banking practice,the risk management of Credit Cooperatives is the focus of widespread concern.From the perspective of financial risk,this article is starting to study the risk of X-county credit cooperatives. In the risk theory about credit cooperatives,financial risk is divided into five kinds of risk that is capital risk, asset quality, risk, liquidity risk, earnings risk, and management level in the paper. In addition the paper analyzes characteristics and classification of the financial risk in detail from the five areas.Meanwhile, the causes of the financial risks existing in the X-county credit cooperatives are explored,then the study identifies factors indicators effecting financial risk by introducing the extension method,and constructs a reasonable financial risk index system, in addition it empirically researches the model on the basis of establishing the Extension model,ultimately draws relevant conclusions.This paper makes full use of the extension theory to establish the matter element model about financial risk for the X County credit cooperatives, then in accordance with the steps of the Extension Act,using C language writes code to calculate the correlation function value and the membership degree of matter evaluated element,in addition indicators of financial risk form the X-county credit cooperatives are identified,in the end they are obtained.These indicators are divided into three categories that is profitability, safety and growth.Based on this,it shows that what can improve the total assets growth rate and return on assets,increasing interest income ratio and total asset turnover,improving liquidity asset turnover,reducing non-performing loan ratio, enhancing cash flow ratio and loan to deposit ratio, decreasing the debt ratio and asset-liability ratio.They can control and reduce the financial risk of the X-county credit cooperatives.