Abstract:

Relationship lending from small and medium-sized banks can not only alleviate small and medium-sized enterprises’ difficulty in financing, but also create profit rises for banks. However, relationship lending has not been widely adopted by small and medium-sized banks and enterprises. The reason mainly lies in inaccurate self-positioning of small and medium-sized banks, unsound credit rating system, the existence of “binding” risks, and defects in related legal systems. The transformation of market positioning and credit concept is the premise to promote small and medium-sized banks to carry out relationship lending. Perfect credit rating system, deposit insurance system, and bankruptcy exit system are both guarantee for banks to carry out relationship lending, and safeguard for the interests of depositors and the stability of economic order. Continuous market-based reform of interest rates can enhance the initiative of small and medium-sized banks to carry out and relationship lending, and can ensure the orderly development relationship lending.

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