China’s Financial Institution Non-performing Assets Disposal Strategy Research

Since the1980s, the world financial situation has changed greatly, multinational enterprises expanded rapidly and international capital flow accelerated. Year by year global financial system gradually formed. Consequently, the financial institutions’ non-performing assets in various countries increase annually. How to prevent financial risks and dispose the financial institutions’non-performing assets becomes the main problems of the financial sector in the world.The financial institutions’ non-performing assets will largely increase its financial risk, greatly influence the capital turnover and thus go against social resource configuration in great degree. Eventually, that will affect the operation of most financial institutions, the entire financial economy and even real economic developmentIn order to cope with the huge bad assets that have been produced due to the changes of the financial institutions. The central and local governments have established asset management company. These companies use all sorts of methods for financial institutions for disposing non-performing assets. In this way, non-performing assets ratio of the financial institutions have been greatly reduced, the financial situation of the financial institutions has been improved obviously. For example, In1999, which was approved by the state council, Huarong, the Great Wall, Xinda, the Orient four wholly state-owned asset management companies, respectively corresponded four major state-owned Banks for the bad assets, which reduced the heavy burdens of the big four Banks in stock reforming and listing.But this day and age, the research on handling bad assets is still in the primary stage, and has not formed a consensus view.This paper uses finance, management, finance theory and new institutional economics in subjects such as the theory and method of the macro and micro analysis by combining empirical with theories, and combining with the graphic character, it elaborates the way to our financial institutions, bad assets of the current situation and cause analysis, reveals the current situation of our country’s financial institution non-performing assets disposal work, and in the light of the problems caused by different categories of financial institutions and bad assets put forward disposal strategy.This paper is divided into six chapters. The first chapter is mainly for the introduction of this subject, the background and significance of the framework and main content, etc.; The second chapter is theoretical study. It mainly introduces the theoretical tool needed. The third chapter is about present situation and disposal method of non-performing assets for financial institutions. The fourth chapter analyzes financial institutions with different categories of non-performing assets disposal strategy research, the most important two of which are the physical assets and financial assets. It also introduces two different assets disposal strategies; The fifth chapter for case studies, mainly based on certain institutions work for the sample.