Study On The Real Estate Credit Risk Of Commercial Bank Using Stress Testing

The real estate industry is a matter of very wide capital-intensive industry, but also a pillar industry in national economy. The rapid development of the real estate industry has effectively promoted the development of real estate financing system.in the development process of the real estate industry, gradually form the system of bank credit-based real estate finance, supplemented by capital markets, private lending and other financing instruments. Bank credit as an important factor in development of the real estate industry, provides a strong financial support for real estate development. proportion of real estate credit increased in the whole financial system, and it’s influence gradually increased. However, the current climate of speculation in the real estate market is so strong, China’s real estate market prices have risen steeply in recent years, however, the effect of the implementation of the2011real estate policy made housing prices declining in many mainly large cities. in the real estate market large fluctuations may occur and even severely adjustment will be severe challenges to the security of the assets of the banking credit.In this paper, we use macro stress testing methods to carry out empirical analysis, through the safety index model between the establishment of the real estate market variables and bank credit assets, using historical data to quantify risk and come to the conduction relationship, in order to examine, the ability of the commercial banks to bear and absorb mortgage losses, if the real estate market is not economic assumptions.The results show that:the rate, GDP growth rate, the price of real estate and real estate development investment are the important factor of commercial bank real estate loan quality; when the commercial bank faces the economic situation deteriorated, the credit risk will increase substantially, but because our country real estate industry has not been a complete cycle of economic recession, and the supervision of the strength is increased ceaselessly, under the hypothetical situations, the bank’s loan loss reserve can absorb the direct losses of the real estate industry.