Research On Measurement And Coping Strategies Of Commercial Banks Credit Risk Based On KMV Model

Credit risk is one of the main risks in the financial market, and which is also the main cause of decline in the assets quality and liquidity crisis of commercial banks. Accurate measurement and effective management of credit risk is not only the primary task of the commercial banks, but also attracted the attention of the regulatory authorities. Facing the increasingly fierce competition and strict supervision, the commercial banks must put forward more diverse and more active methods of credit risk management. Based on the research of loan companies in specific industries, this paper puts forward suggestions and opinions on the credit risk management of commercial banks in China, especially the Agricultural Bank of Hubei province.Firstly, this paper describes the concept and characteristics, summarizes the theoretical background, measurement methods and research status of domestic and international about credit risks management of commercial banks. Secondly, provided by the stock price and other financial data of several agricultural companies of Hubei and surrounding provinces from financial website, this paper makes an empirical analysis on the credit risk management of Agricultural Bank of Hubei province with the applicability and popular KMV model. Finally, based on the conclusion of empirical analysis, this paper puts forward ideas and suggestions to the credit risk management of agricultural companies and Agricultural Bank of Hubei Province, and to the improvement of the application of KMV model in the field of credit risk management of Chinese commercial banks.