Our Country Commercial Bank Loss Provision Provision Effectiveness Analysis Method

After the us subprime mortgage crisis in2008, as the international active Banksbankruptcy and mergers and acquisitions, risk management of commercial Banks beganto attention by the governments, loan loss provisions for the commercial bank riskmanagement as an important tool, is the first line of make up for the expected losses,many studies have shown that after the crisis loan loss provisions for the shortage of thedeepened the influence degree of the crisis, so active foreign Banks began to furtherperfect the provisioning management system.Since1988, after the construction of the reserve system in our country, through thecontinuous development and improvement. Now, based on discounted cash flow, eachbig firms set aside provisions, though improved, but still not fully effective. This paperuses the panel data of the empirical analysis concludes that our country commercialbank loan loss provisions cannot effectively reflect the quality of credit assets is really,don’t have the function of the countercyclical regulation, at the same time has a strongpro-cyclical. And current advanced foreign Banks to adopt dynamic provisioning caneffectively alleviate the pro-cyclicality of loan loss provisions, at the same time canhave the effect of counter-cyclical adjustment, based on the use for reference theexperience of Spanish dynamic provisioning rules is proposed on the basis of theamount of credit dynamic provisioning model is more suited to the actual situation ofour country commercial bank. And in discourse analysis our country firm set aside onthe basis of the actual provision of regulators and commercial bank gives thecorresponding Suggestions to improve the effectiveness of the loan loss provisionprovision.