Chinese Bank Sets Up Credit Risk Reporting System

The China Construction Bank (CCB) announced Friday that it has set up a reporting system for serious credit risks in the bank, in an effort to get a timely grasp of the bank's risk conditions and improve its efficiency in handling serious credit risks.

The CCB requires all its branches to closely follow various conditions that constitute serious risks to the bank's credit assets. Once discovered, they should timely report to higher authorities.

The conditions that should be reported include: signs of obvious deterioration of credit quality indices, signs of key clients' negative impact on the bank's asset quality, the issuing of documents or policy guidance by local governments or other institutions that contradict national financial laws and endanger bank's asset safety, as well as other serious credit risk cases that need to be reported to the CCB headquarters.

The CCB has also drafted detailed stipulations on related procedures and responsibilities, and designed relative measures for rewards and penalties.

A spokesman for the CCB said that over the past two years the bank has paid special attention to the construction of a credit risk control system, and formulated a series of rules and measures to standardize the bank's procedures in managing credit businesses, setting a good system basis for gradually lowering the ratio of non-performing loans and raise credit asset quality.

People's Daily Online ---