Causes Of Credit Risk Analysis Of China’s City Commercial Banks Microcredit

Urban commercial banks is the rookie of the banking industry, developing faster and there is also many problems.Qilu fraud case that shocked the nation puts urban commercial banks’ credit risk in advance onto the agenda. The geographical features of the city commercial banks determine that Urban commercial banks operating assets of the business is a small loan business,so that its credit risk is primarily from microcredit risk. Microcredit risk of urban commercial banks include credit risk, market risk and operational risk, the main risk is credit risk.The idea of this paper is that introduction of urban commercial banks by the operating agency of the small loan classification,then introduction of China’s urban commercial banks credit risk of small loans by analyzing the development status,then introducing Micro-credit risk analysis of urban commercial banks. Next, from the city commercial microcredit risk classification introduced the main content of this chapter,which is analyzing the influencing factors of our country’s urban commercial banks credit risk. The end of this article is about suggestions of improving the urban micro-loans of commercial banks risk management.The contents of the overall framework of this article can be divided into three parts. The first part is about the Small Loan Status Quo of China’s urban commercial banks,including introduction of microcredit concept and classification,and of urban commercial bank status and business status quo,and of analysis of a urban commercial banks microfinance business development. The second part is about our country’s urban commercial banks risk analysis of small loans, including our country’s urban commercial banks in micro-credit risk and credit risk characteristics introduced. The third part is about factors affecting the quantitative and qualitative analysis of our country’s urban commercial banks credit risk of small loans.Based on that, proposing Credit Risk Management in our country’s urban commercial banks microcredit recommendations. Method used in this paper is quantitative analysis based on the results of the qualitative analysis, which consideration various factors considered in the quantitative analysis of the final selection of the Analytic Hierarchy Process. Analytic Hierarchy Process is a combination of qualitative and quantitative, systematic, hierarchical analysis method. This paper argues that AHP is the most suitable to achieve the purpose of this chapter methods, There are three’reasons: First, the AHP is a combination of a quantitative and qualitative methods, to overcome the disadvantage of Delphi method,which is too subjective; Second, you can achieve the purpose of this chapter to determine the influencing factors of weight, to overcome the shortcomings of the maincomponent analysis; analytic hierarchy process coincides this paper’s idea, the idea is based on a quantitative analysis on the basis of qualitative analysis, analytic hierarchy process is built on the basis of qualitative analysis, quantitative analysis,visible coincides with the analytic hierarchy process analytical thinking of this chapter.The conclusions of this paper include two aspects, the qualitative analysis of the results and quantitative analysis of the importance of sorting. The results of Qualitative analysis is selecting15specific impact indicators,including working years, operating life, age, and short-term solvency, profitability, operational capabilities, personal credit record, level of education, the term of the loan, the purpose of the loan, loan size,guarantee, loan officers quality,supervision, incentives. Sort results based on the weight from high to low is guarantee, operational capabilities, personal credit record, the term of the loan, operating life, the purpose of the loan, working years, loan officers quality, profitability, the term of the loan, age, level of education, the loan size, supervision, incentives.There are three innovation points in this paper. Firstly, this paper show an interesting new approach to the influencing factors of the city commercial bank’s microfinance risk which scholars before seldom study. Secondly, the angle to analysis the influence factors is new. This paper analysis from the perspective of the clients of Microfinance, the characteristics of micro-finanace and the commercial bank. Thirdly, the idea of this paper is new. Former scholar’s research is based on the purpose of predicting the credit risk model and using the model to reflect the significance of the indicator. However this paper is purpose on analyzing the significance of indicators, which we can used to build the standby database of evaluation model indicators.There also have some defect in this paper. For example,when we analyze the influence factors of the micro-credit risk of commercial bank we only focuses on the micro-level factors and neglect the factors from the macro level. The second, as the capacity of the author, the analysis may ignore some important factors influencing factors of micro-credit risk of city commercial banks. The last, cause the data is not easy to collect, the article does not use credit scoring models to verify the actual role of these factors.