The Research On Credit Risk Management Of Small And Medium Enterprise In Changsha Branch Of Industrial Bank

Small and medium enterprise (SME) has been playing an important role in economic growth, prosperity of market economy, promoting employment, increasing revenue, and so on. Along with the development of the international financial crisis, governments at all levels have enacted policies to increase financial support for SMEs to solve the problem of financing. Loan business, which maintains the basis for bank survival and development, is an important business for banks, and bank loan is the most important external source of SME financing. Seeking SME customers and expanding SME loan will be a new growth point of bank loan, with the more mature of direct financing market, and the more intense competition for large quality corporate customers. Credit risk, which is the main risk for bank management, is the key to keep the assets safe. Research on SME credit risk management of commercial banks, has great practical significance for guarding against credit risk and maintaining the safety and profitability of loan assets, while keeping the growth of SME loan.First, this paper describes the theoretical basis for SME credit risk management from four aspects including information asymmetry, transaction costs, credit rationing and loan commitments, overviews elements of SME credit risk management by organization, goals and cycle, revenue model, credit support mode. Then, it takes the way of combining theory with practice, and introduces the SME credit business development and risk management conditions in Changsha Branch of Industrial Bank. In order to explore the common difficulties for commercial bank the current credit risk management of SME loan, it selects asymmetric information between bank and enterprise, and the high transaction costs caused by the lack of specific credit risk management. It analyzes the problems of SME credit risk management existed in Changsha branch of Industrial Bank,from the three aspects including the credit risk management system, technical methods, credit management services, and seeks out the reason from three aspects including commercial banks, small and medium enterprises and their external financial environment, it is the internal control of commercial bank, the SME’s own management and external financial environment that consist of the reason for the problems of the current SME credit risk management. Finally, on the basis of reference to the experience of the advanced models foreign bank credit risk management, from a sound credit system for SMEs, put up some related measures about strengthening the credit before the survey, improving the credit guarantee mechanism, encouraging innovation and other aspects of the credit model.