Research On Cooperation Relationship Between Commercial Banks And Credit Guarantee Companies

The importance of small and medium-sized enterprises to the national economy development is self-evident, but its financing problem which demands urgent solution has become one of the government’s major problems. Considering that the main reason for the small and medium-sized enterprise financing difficult is the lack of mortgage collateral, the general practice of all countries in the world at present is establishing SMES credit guarantee system through a third party credit guarantee for small and medium-sized enterprises, and their goal is to improve the probability of a bank loan. From the perspective of the financial system in our country, the bank which is the main source of external financing for SMES is in absolute dominance, so establish the SMES credit guarantee system is of great importance for solving SMES’s financing problem, so since1992, the government has promoted the building of small and medium-sized enterprise credit guarantee system, but the number of guarantee agency is not so much so far. And the guarantee agency has played an important role for solving small and medium-sized enterprise financing in the improvement of the relationship between banks and SMES.Considering the mercerization of interest rate in our country, the competition between banks will be more intense in the future, one of the main mean is that the competition of customers. As is known to all, the high quality large customers are limited, and the liquidity is very high, and in the face of such customers the bank’s bargaining power is very weak, on the contrary, the number of small and medium-sized enterprises is very large and their demand for financing is becoming more and more large, in the process of mercerization of interest rates, commercial banks should strive for such small and medium-sized enterprises. But one point that banks should be not ignored is that the risk of small and medium-sized enterprises is still existing, if the commercial banks want to obtain a stable interest income in this part they need to find a balance between risks and benefits, and the credit guarantee company is such a balance. Only commercial banks and credit guarantee companies establish a real "risk-sharing, benefit-sharing" relations of cooperation can help them make a significant advantage in the competition for small and medium-sized enterprise customers. As a third party intermediaries, the function of credit guarantee companies relies on the cooperation with commercial banks. But based on the cooperation situation in our country, the cooperation between the two sides is still in the primary stage, and the credit guarantee company is more like a means for commercial banks to diversify risks. They haven’t established the cooperation mechanism of risk-sharing and benefit sharing. Coupled with the recent default incidents, this relationship has become more serious. With the consolidation stage in the guarantee industry, the partnership will face a new challenge.The research on the cooperation between commercial banks and credit guarantee companies is too theoretical or too simple. There is still no comprehensive analysis about the relationship of cooperation and the problems between commercial banks and credit guarantee companies. In this paper, we start from the asymmetric information theory, risk-shifting theory and transaction cost theory to analysis the cooperation basis between commercial banks and credit guarantee companies. And departure from practice, we discuss the reason that commercial banks, credit guarantee companies and SMEs need to cooperate. The analysis revealed that a good cooperation will be able to achieve a tripartite-win situation among small and medium enterprises, commercial Banks, and credit guarantee companies, but also it helps to increase the social welfare, so the cooperation has a strong foundation. After this, the author analyzes the current cooperation situation in our country, we get a very full view of the development of the guarantee industry through the analysis of the types and development characteristics of guarantee company, and then I do a further analysis of the cooperation mode and cooperation problems combining with the current situation, and point out the main problems of the cooperation in four aspects: first, the commercial banks don’t have a strong will and their enthusiasm is not high; Second, in the process of cooperation both sides share unequal rights and obligations; Third, the credit guarantee companies are lack of a good faith in the cooperation; Fourth, commercial banks are lack of responsibility in the cooperation.After clearing the problems in the cooperation, I explore the reasons from the perspectives of the external environment, credit guarantee companies and commercial banks. Because of the lag of related legal system construction and the bad social credit environment, commercial banks and credit guarantee companies do not have a good cooperation environment; Low barriers to entry in guarantee industry, the high risk and low income situation and the lack of funds compensation and risk dispersed mechanism make the guarantee strength and the ability to deal with risks of guarantee institutions questioned; The lack of interest-driven on the loan business of small and medium-sized enterprises, low recognition of credit guarantee companies as well as excessive dependence on traditional mortgage loan limit the enthusiasm of the commercial banks in the cooperation with credit guarantee company. Therefore to optimize the cooperation relations, it not only needs a good external environment but also needs to improve the inner cooperation mechanism, then it can really realize a "risk-sharing, benefit-sharing" cooperation relation.