The Research On Internal Credit Rating Management In Hunan Branch Of ICBC

The time of customer rating and loan grading carried out by China’scommercial banks is not too long, and the quantity is not much. Currently, there isnot a scientific and reliable credit rating system. Led by four state-ownedcommercial banks, the commercial banks in china are groping and establishing theirown internal rating system. But in China, there has neither authoritative third-partyassessment agency, nor scientific and effective rating system. Without unifiedindustry standards, the commercial banks implement their own customer ratingcriteria. The differences of results of credit rating in different banks are significant.In developed countries, however, not only have formal third-party rating agencies,but also have reliable and effective rating system. The level and awareness of creditrisk management in domestic commercial banks have yet to be strengthened andenhanced. Because the reliability of credit rating depending on the authenticity ofdata provided by rating customers, therefore, building a set of customer credit riskrating system according to the bank’s internal credit data is particularly important.In this paper, we firstly introduced the definition of credit risk and the maincontent of internal ratings-based (IRB) under the New Basel Accord, analyses theresearch situation on the probability of default model (PD) at home and abroad.Then introduce the situation of internal rating in Hunan ICBC, analyses itsachievements and inadequacies in first and second phase of internal rating project.Finally, we established corporate credit risk assessment model using logisticregression model to empirically analysis the Hunan ICBC’s corporate customers. Atthe time of model establish, we randomly selected72companies as modelingsample group,58companies as test sample group. Though the processing of samplegroup’s2012data, we got40financial indicators. The indicators were screened bynormality test, hypothesis test, correlation test using SPSS software, and regressionanalysis were carried out by logistic regression model.Though the processing of test sample group to verify the model,we find thatthe accuracy rate is84.5%. The corporate credit evaluation model established inthis paper is very effective for Hunan ICBC.