Research On Credit Risk Management Of Loans For Rural Credit Cooperatives

As a professional rural financial institution in China, the rural credit cooperative is one of the main sources of agriculture related loans and has made a great contribution to the development of rural economy. However, due to defect in the institutional mechanisms and other aspects,the credit risk has been one of the main sources of risk for rural credit cooperatives, which directly hindered the development of rural credit cooperatives. Credit risk management for rural credit cooperative is project with wide coverage and complex operation.Meanwhile it is also a very meaningful and necessary kind of work.Thus focusing on credit risk management will improve the operating performance of rural credit cooperatives and make it better to work for agriculture-related loans and make a larger contribution to the development of rural economy and society.Credit risk is an old topic, which has generated a lot of related theory along with financial development.This paper first sorts out the theories of the credit risk and researches on credit risk management.Then it analyzes the recognition, measurement and control strategies for credit risk. Using Taojiang county rural credit cooperatives as an example, by analyzing several specific case of loans, this paper reveals flaws in each segments of the loan, and points out other existing problems in the management system and risk management system. Furthermore, using data of loans to farmers, it builds a Logistic model of whether a loan is overdue to explore the effect factors for credit risk.The results show that per capita net income and whether there are other loans will significantly affect the credit risk.On the basis of experience for foreign rural cooperative financial and commercial banks to control credit risk, this paper presents corresponding suggestions of credit risk management for rural credit cooperatives in each aspect of the problem and proposes initial ideas to build a comprehensive risk management system.It is hoped that these studies will draw upon credit risk management for rural credit cooperatives and accelerate its restructuring pace to rural commercial banks. Abstract...