The Research On Fireworks Enterprise’s Loan Credit Risk Management Of Bank Of Changsha Liuyang Branch

Loan Risk management, a major component of loan management of BCS, is animportant tool to prevent and mitigate credit risk. Currently, large of non-performingloans assets and high potential risks of commercial banks is a problem. It is seriouslyundermining the competitiveness of commercial banks and endangering the survivaland development of commercial banks, with a increased public focus. Commercialbank is meeting the challenge of improving the quality of loan assets, strengtheningmanagement loan risk management, and reducing the ratio of non-performing loans.Therefore, the study on status of corporate lending risk management and its strategicchoices of Liuyang Branch of BCS, not only has theoretical and practical significanceto promote loan business to Liuyang Branch of BCS, but also has practicalsignificance to improve management of loan risk to BCS, even to State-ownedcommercial banks as well.This paper introduces the basic principles of credit risk management, includingcredit risk definition, the causes, metrics and the control method.Then, this paper usesthe method of combining Theory and practice, combined with the actual situation ofLiuyang branch of BCS. We analyze the fireworks enterprise’s situation and loan qualityin detailed. Meanwhile, this paper introduces the metrics of credit risk on fireworksenterprise, mainly about credit scoring models, risk level measuring, estimating loanamount, property insurance and loan management. Lastly, from the perspective of BCScredit risk measurement and control’s defects, this paper proposes optimizationmanagement processes of fireworks enterprise’s credit risk, establishes managementconcepts of credit risk, practices dynamic testing for five classification of loan quality.The bank used the identification method by fireworks enterprise credit risk,credit risk measurement methods, credit risk management strategies in the actual work,not only to enhance the bank’s work efficiency, but also to prevent the credit risk, dueto the fireworks industry downturn in the past year. the bank keeps non-performingloan’rate to zero since the12-year. The management experience of credit risk in thefireworks has been classified as innovative by Changsha bank, while the bank wasnamed the fireworks franchise branches.