China's Commercial Bank Real Estate Credit Risk Control Research

Due to the impact of financial crisis in2009, the economic development in many countries was into a downturn. In this context, national implement the loose monetary policy, so the domestic real estate market began to pick up and change in to the unique "landscape" in "winter" of the international financial crisis.The prosperity of the real estate market led to a substantial increase of the real estate credit, however, in2011national macro-control policy became loose to tight, and real estate market began to change, once house prices fall,the trend will make the real estate credit risk concentrate, and lead real estate credit risk which hidden in the rapid development to expos, thereby affecting the banking industry and the whole financial stability. Therefore, researching the for commercial banks in China is very necessary.This paper research how to control the real estate credit risk in commercial banks of China. Firstly analysis the theoretical based on the real estate credit risk, following analysis the present situation and problems of the credit risk controlling of commercial banks, thirdly research the causes to the real estate credit risk, and finally proposed the suggestion to how to control the real estate credit risk of commercial banks in China. At present, China’s commercial banks control the real estate credit risk through "loans before the survey, review of loans, loan management" three stages, though achieve some effects in a certain degree, As far as the overall real estate credit risk control, there are still some problems, one is commercial bank pay too much emphasis on collateral for the source of repayment during the assessment process, the second is commercial banks is too optimistic about the retail real estate credit risk, the thirds is the Internal rating in commercial banks exist more problems example less sensitive and less risk measures. There are some problem about the real estate credit risk because of lack of regional policy, concentration of credit risk and imperfect information and other factors. The article analyzes the causes of the current real estate credit risk of commercial banks in China from the four aspects such as the real estate price bubble, the national macro-control policy, the credit risk of the borrower and the bank’s own operations. Finally, the article Put forward the four ways to control of the real estate credit risk of commercial banks in China from the government’s macro-control, the bank’s internal management, improve the credit system and the mortgage securitization given. From the government’s point of view, we should increase efforts to control the real estate industry and to strengthen the supervision of financial institutions, in order to avoid frequent regulation. From the bank perspective, the bank should pay more attention to the supervision of the real estate credit risk, and strengthen management with the internal team, as well as establish a unified customer information management system.