In fact, it is the ratio of bad debts to provision for doubtful debts's withdrawal. For example, the proportion of bad debt reserve in China is 9%, and the extracted reserve enters the current profit and loss.
It is a possible bad debt and bad debt reserve in bank loans, an aspect of bank's prudent screening and risk prevention, and a quantitative indicator reflecting the authenticity of performance.
The lower the ratio, the better. The smaller the reaction loss, the higher the profit. The higher the ratio, the greater the risk, the greater the loss and the smaller the profit.
The risk degree of joint loan should not be too low or too high, otherwise it will lead to the virtual decline of excess reserve funds and profits.
This indicator reflects the risk degree of bank loans, socio-economic environment, integrity and other aspects from a macro perspective.
2. How to calculate the provision gap?
In fact, it is the extraction ratio of bad debt provision. For example, the proportion of bad debt provision for accounts receivable of listed companies in China is 9%, that is, bad debt provision is made according to 9% of the balance of accounts receivable, and the extracted provision enters the current profit and loss.
It is a possible bad debt and bad debt reserve in bank loans, an aspect of bank's prudent screening and risk prevention, and a quantitative indicator reflecting the authenticity of performance.
The lower the ratio, the better. The smaller the reaction loss, the higher the profit. The higher the ratio, the greater the risk, the greater the loss and the smaller the profit.
The reserve ratio should be adapted to the degree of loan risk, and it should not be too low to lead to insufficient reserves and inflated profits; It can't be too high, which will lead to too much reserve funds and a virtual decline in profits.
This indicator reflects the risk degree of bank loans, socio-economic environment, integrity and other aspects from a macro perspective.
3. How to calculate the provision gap?
In fact, it is the extraction ratio of bad debt provision. For example, the proportion of bad debt provision for accounts receivable of listed companies in China is 9%, that is, bad debt provision is made according to 9% of the balance of accounts receivable, and the extracted provision enters the current profit and loss. It is a possible bad debt and bad debt reserve in bank loans, an aspect of bank's prudent screening and risk prevention, and a quantitative indicator reflecting the authenticity of performance. The lower the ratio, the better. The smaller the reaction loss, the higher the profit. The higher the ratio, the greater the risk, the greater the loss and the smaller the profit. The reserve ratio should be adapted to the degree of loan risk, and it should not be too low to lead to insufficient reserves and inflated profits; It can't be too high, which will lead to too much reserve funds and a virtual decline in profits. This indicator reflects the risk degree of bank loans, socio-economic environment, integrity and other aspects from a macro perspective.
Four, how to calculate the loan reserve gap?
The calculation formula of loan reserve gap is as follows: calculation formula = actual loan provision/provision, which should be greater than 100%. Assets for loan loss provision include customer loans, lent funds, discounted assets, syndicated loans, trade financing, agreed overdrafts, credit card overdrafts, refinancing and advances. Every quarter, the bank will analyze the loan situation and then determine the actual amount to be withdrawn. The adequacy ratio of loss reserve shall not be lower than 100%, because according to regulations, credit risk monitoring shall exceed the expected value, including indicators such as non-performing asset ratio, credit concentration of single group customers, all correlations, loan loss reserve adequacy ratio, etc., which are stipulated in the Core Indicators of Risk Management of Commercial Banks in 2006.