Game Analysis On International Trade Financing Between Bank And Exporter

At the time of the global economy and information age’s arrival, international trade finance has made the tremendous contribution in the promotion of the economic development between countries. Increasingly frequent trade between countries not only increases the common interests, but also increases the trade risk. The most important risk comes from banks and enterprises. For a time, The risk problems between banks and enterprises have become an important research topic among the experts and scholars, which the financing risk problem under the letter of credit is included. Solving these problems will promote China’s economic growth and help to carry out international cooperation. Therefore, this paper from the packing loan under the export letter of credit to study the strategy game in terms of risk problems between banks and exporters in international trade financing, provide better theoretical support to promote the cooperation between banks and enterprises.First, this paper introduces the theory of international trade finance concepts. Secondly, on the basis of previous studies, an innovative way to signal game and evolutionary game model applied to the practice of the letter of credit packing loan, focusing on the game problem of loans between banks and export enterprises. Building a two-period game model of two players, a bank and a high-risk exporter, by applying the signaling game to the letter of credit packing loan. Using this model it analyzed the respective optimal actions of the two players in separated equilibrium. Finally, the evolutionary game theory is applied to study the relationship between the exporters, and provide theoretical support for learning and imitation effect between export enterprise clusters, so as to guide the export companies toward positive direction.The conclusion is that in face of both high and low-risk types of exporters, the best way for bank is to prevent in the first place. Then the bank should analysis the risk types of exporter, identify the signal sent by exporters, choose their own actions carefully, and to make their utility is maximized or minimized the risk of loans. In addition, in the exporter clusters, we should pay full attention to the power of ―model‖. And the export enterprises adopt ―compliance‖ strategy related to the ―reward‖ and ―punishment‖. When the export enterprises adopt ―compliance‖ strategy to obtain the benefits outweigh the costs they pay. No matter how many export enterprises adopt ―compliance‖ strategy in the beginning, finally all export enterprises will take ―compliance‖ strategy. Banks should make full use of evolutionary game theory, minimize the risks duo to the export enterprises, to achieve a harmonious financial situation between banks and enterprises.