The Study Of Risks In Cooperation Between Forma Financial Institutions And Leading Agriculture Enterprises

Cooperation between formal finance and leading agricultural enterprises is different from the general company loans. Real users of funds are farmers; therefore there are also differences in the risk control. The thesis of the study is to evaluate the risk conditions, and put some measures.In this paper, based on the rural finance theory, according to the role of the leading enterprises, the cooperations are mainly divided into three forms:the credit mode, order pledged mode, leading enterprises guarantee mode. Then, formal financial institutions through customer screening, credit control, post-loan supervision, leading enterprises through technical guidance, and government through contract risk supervision control the risks.The analysis reveals that the risk is mainly from farmers, agricultural enterprises, orders for the contract as well as the external environment. The papers set a system including the credibility of the farmers, the education level, the level of production technology, secured by mortgage situation, the credibility of the leading enterprises, production and operation situation, risk control situation, mortgage-backed level, contractual terms, arbitration, default costs, incomplete contract, the price risk, natural risks, policy risks and risk protection. The weight of each index is made by Fuzzy Analytic Hierarchy Process.Based on the principle of maximizing leading agricultural enterprise risk control measures differences, the paper selects the Shan Xi Hengha delicacies and Cattle Industry Co., Ltd., Liaoning HTC, using established risk evaluation system to evaluate the risk profile. The study found that formal financial institutions, in cooperation with the latter, risk-based value is only0.398, far less than the co-operation with the former0.722. Significant differences in risk situation happens, because the latter has taken some effective means to control credit risk, including participating in the household survey, requiring farmers to take part in concentrating feeding to efficiently monitor the behavior of farmers and providing a c ounter-guarantee.In this.paper, by constructing three risk control line to reduce the risks:the first risk control line, farmers should be strengthened to learn technical knowledge and enhance insurance awareness, leading agricultural enterprises should improve production technology and strengthen farmers training, the insurance company should provide innovative agricultural insurance products t, the government should play an active role in guiding; second risk control line, leading agricultural enterprises establish farmers risk evaluation system, use the introduction of intermediary organizations, strengthen the establishment of the incentive and restraint mechanisms, help farmers manage natural risks; third risk control line, leading agricultural businesses can use tools such as futures and options to control market risk, insurance companies provide a full range of insurance, guarantee companies provide enterprises reguarantee, the government compensate for the loss of the formal financial institutions.The main innovations of the paper are as follows:topics reflect the problems in the development of agricultural industrialization:funding difficulties. The thesis finds some risk control means:the company directly participates in the household survey, use the bases to monitor farmers, establish physical collateral.