Research On Risk Management Of Financial Leasing Business Of Auto Financecompany

In recent years,the automotive industry has shown a promising development prospect with a rapidly growing output and sales volume.From the national level,various favorable policies for stimulating automotive consumption emerged as the times require.Meanwhile,huge capital injection also facilitates the rapid development of automotive finance.Among automotive finance,automotive leasing has advantages such as low down payment,low loan threshold,simple process,etc.,which makes it have the potential to gradually replace the mode of traditional bank credits.Under such background,capitals turned to look at the automotive leasing industry,and several automotive merchants developed this business successively,meanwhile,related industry chain got improved in this process.However,the automotive leasing business is still in the ascendant.Relevant laws still need to be improved,and the market supervision mechanism in the industry is still immature.Due to the lack of benchmarking enterprises,individual automotive leasing company has no reference object in managing risks.All of these factors lead to the high rate of bad account and high bankruptcy rate.Meanwhile,the risk management level of the company does not match the rapid growth of the business.Therefore,automotive leasing company urgently needs to enhance risk management capability scientifically and effectively at present.Based on the high similarity of automotive leasing business and financial lease business,this thesis studied the whole-process risk management from the risk identification,assessment,response,prevention,and management of financial lease,and offered the basis for the theoretical research of the automotive leasing industry.Meanwhile,discussions were made on the risk management problems of automotive leasing of Z company,which acts as the research subject,and offering risk management countermeasures and suggestions in combination with theoretical research.It is found by the research that according to the information asymmetry theory,automotive leasing company should fully investigate the lessee before leasing,make continuous tracking and monitoring for the lessee,keep eyes on the change of leasing asset,and recognize risks for the automotive leasing company brought by the negative results of both the adverse selection before the lease and moral hazard after the lease.Based on the game theory,analyzing the four-stage game process of both parties of the automotive leasing business,and concluding the interior risk and external risk faced by the automotive leasing company,among which credit risk and operational risk are controllable risk points.Therefore,this thesis deeply investigated credit risk and operational risk.By theoretical analysis,this thesis recognized risks of the automotive leasing company,made leasing risk analysis by CAMELS credit rating system,constructed the risk management framework of COSO-ERM,and realized the effective management for automotive leasing business.To better advance the coordinated development of the financing industry as well as the auto industry in-depth,this essay focuses on the risk management of operating lease,which takes Z company as an example.First and foremost,this essay starts with the real situation of the company operation,in which relevant theories are employed for further analysis.Next up,by adopting game theory,this essay summarizes the operational risk and credit risk in Z company.Asymmetric information theory is engaged to make an analysis of credit risk,and internal control risk as well as liquidity risk are investigated from the perspective of internal control.At length,taking the real situation of Z company into consideration,three initiatives,namely,auditing system and application of information technology,mid-to-late credit system before lease,and comprehensive risk management are put forward in response to operating risk,credit risk,internal control risk and liquidity risk.Moreover,some practicable solutions have been proposed regarding risk management issues in Z company.Playing a guidance role in the operating lease,this essay enriches the risk management theory of operating lease as well.The contribution:(1)This essay focuses on the risk management of automobile financial leasing business.Though this business has developed rapidly in recent years,the current research pays more attention to the automobile financial leasing instead of the risk which has its own character in this business.So,this essay devotes itself to analyzing the internal and external risks of companies running this business,and offering corresponding solutions.(2)Based on case study and combined with literature analysis,mathematical model and other methods,this essay analyzes the risks which have been or will be in automobile financial companies in detail,and then gets the corresponding solutions.(3)Most of these companies are in small or medium scale.Their level of risk management will determine the systemic risk of auto financial market.Analyzing specific cases of some firms,this essay starts with the existing problems in automobile financial leasing market,explores in-depth reasons from the fact,and obtains practical solutions for risk management in this industry.That would bring some enlightenment and guidance for the risk management and development in Chinese automobile financial leasing business.