A Research Of Risk Management Of Biological Assets Mortgage Financing

Mortgage difficulties has been a barrier hindrance to the development of rural economy. The important reason for the rural mortgage difficulty is the lack of effective collateral. According to the actual situation, farmers found a new way to improve it. The biological assets mortgage financing can be use to solve what hindrance to the development of rural economy.This paper draws on the theories which are influencing the biological assets mortgage loan, such as the basic concepts of biological assets, mortgages theory, asymmetric information theory and risk management theory. Secondly, this paper analyzes the status of biological asset mortgage loan and the subjective risk and objective risk of biological asset mortgage loan. Again, this paper finds the causes of what may affect the risks of the biological mortgage assets. This paper investigates some information from farmers by questionnaires. Then it uses the logistic model analyzing the influence factors of these assumptions. It obtained factors that may have a significant impact on biological assets mortgages. Finally, this paper builds a system of controlling the risks of the biological asset mortgage loan. This paper puts forward its own ideas to improve the relevant biological assets mortgage loan.Based on the above researches, this paper finding that risks of the biological assets are caused by mortgage credit risk, operational risk, mortgage dummy risk, the value of collateral, liquidity risk and natural hazards. The factors which having the significant impacts on the risks are individual farmers, farmer family factors, biological factors and institutional factors assets. Controlling these risks is managing the national policies and regulations of bank lending before or after the loans. We hope this paper providing some positive influence to Chinese biological assets mortgage loans and promoting the development of the agricultural financial.