All About Loan Refinanc You Should Know(7)

(4) The mismatch between the mode of financing of indirect financing of enterprises and the cycle of production and operation funds objectively leads to the implementation of loan sloan refinance of some large amounts of loans due. At present, corporate customer loans are generally a one-time issuance, one-time recovery, credit funds invested in the production and operation of enterprises often converted into raw materials, finished products, accounts receivable, monetary funds and other assets a certain proportion of the combination, circulation turnover. At the same time, enterprises in order to improve the efficiency of the use of funds, generally try to reduce the occupation of idle money, large loans due, it is generally difficult to use the normal business currency of enterprises to achieve monetary recovery of all loans, banks sometimes have to maintain the customer stock loan turnover through loan refinance.

Policy recommendations

(1) The regulatory authorities shall clearly define the conditions for the processing of loan refinance. to enable it to play a role within a reasonable range. As the CBRC for the conditions for the handling of loan refinance has not been clear, countries have commercial banks set their own some situationtorize, the standards are not the same, grasp different, easy to cause risks. Therefore, the regulatory authorities should as soon as possible issued the loan refinance limit terms, clearly defined that can handle loanloans, the number of times, the term and other content.

(2) The regulatory authorities shall reasonably determine the term of the loan and try to avoid the occurrence of loan loans. When amending the rules on bite loans and the laws, regulations and normative documents concerning the term of the loan, it should be made clear that banks should reasonably determine the loan term in accordance with the term of use of credit funds by enterprises, and on this basis, scientifically negotiate specific debt service and interest repayment methods, and avoid and reduce the occurrence of loan refinance from the system.

(3) To further standardize the classification and identification of loans in the light of the core definition of the five-level classification of loans. It should be made clear that the maximum classification level of loans for loans to loans does not exceed the category of concern. Loan refinance loans that meet one of the following criteria shall be classified at a sub-grade and the following categories. The specific conditions are: the enterprise can not pay interest in full and on time; loan loan processing more than 2 times (including 2 times) ; The bank can not fully implement the creditor's rights, or there is a hidden legal risk in the process of reorganization, merger and separation;

(4) Establish a risk-based credit management system as soon as possible to effectively improve the level of bank credit management. Loan needs to handle loan refinance, to a certain extent reflects the commercial banks in the specific credit business work of the loan 'three check system' implementation is not in place, the business cycle, business conditions, industry characteristics of the understanding is not enough, so commercial banks must be required to improve the credit management system as soon as possible, effectively prevent credit risks and operational risks

(5) To establish an assessment and evaluation system that takes the benefits as the center and takes into account the near-term and long-term benefits. As soon as possible to establish a complete performance appraisal index system, including internal operating indicators, customer indicators and employee development indicators, to scientifically reflect and guide future performance. Change the current existence of heavy business performance, light business management tendency, in the business performance evaluation method, increase the internal control management, standardized operation, asset quality authenticity and other indicators of weight, to avoid the asset quality indicators are too high, out of touch with reality, resulting in the bank grass-roots pressure is too large, in the expansion of the business movement deformation, behavior distortion.