Z Bank Credit Card Credit Risk Analysis And Control Research

With the rapid economic development in China, increment of resident’s purchasing poweras well as the change of consumption concept, credit card as a convenient way of trading hasbeen developing in China quickly. Credit card has become one of the indispensable andimportant means of payment in today’s society, and it is one of the key businesses that thebanks are scrambling to develop.After years of rapid development in the credit card business, the banks have issuedexcessive credit cards for expanding their customer scale, which has led to huge risk exposurein this aspect. With the slowdown in economic growth for the recent years, the cardholder’ssolvency is decreasing and the overdue and bad-debt rate is also quietly rising which are theinsidious effects from the blind expansion of the credit card issuance.In addition, there are many restrictions of the credit card services, which are from thefollowing aspect: the scale of loan service has been restricted due to the tense of flexibility ofbank services and the limitation of the head office; the capital constrained since the rising costof capital; and the economic downside risk constraint. How to reduce bad-debt rate under theloan services constraints, capital constraints and risk constraints, how to change the credit cardbusiness from blind expansion of customer volume to intensive and meticulous developmentand operation and how to adjust the structure of customers are the future development focus ofthe Credit Card Center.Focusing on the existing problems of high bad-debt rate of the credit card business, thisthesis used Z Bank Credit Card Center as a case study to solve the collection problem as wellas its existing customers portfolio problem, figure out the defective customers and propose acomprehensive risk control mechanism for pre-loan, during loan and pro-loan management.This thesis can be used as a case reference for the credit risk solution and prevention bycommercial bank credit card centers.This thesis performed a credit card credit risk analysis and proposed the risk managementstrategy and feasible recommendations. On one hand, I hope that through the use of the proposed optimization strategy suggestions, the credit card center can optimize the customersstructure, reduce bad-debt rate and overall reach the card center management objectives. Onthe other hand, I hope that the analysis and suggestions can serve as a theory guidance andreference for the risk analysis and risk control of commercial bank credit card business.