A Study of Critical Factors of Housing Loan Quality in Hualien Area

• Main Authors: Chi-hao Chiu, 邱繼豪
• Other Authors: Timothy Tingson Wang
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/93965033046551037516

碩士 === 國立東華大學 === 國際企業學系 === 97 === The U.S. subprime mortgage crisis exploded in 2006 had a profound impact on world’s financial markets. This financial storm expanded unceasingly to trigger the 2008 financial tsunami. Financial institutes around the world have been impacted seriously. The losses have wiped out much of capitals of the world banking system. While some financial firms can be survived, some become bankrupt or reorganized. This financial tsunami does not only impact the overall industry but also the investors. According to Financial Supervisory Commission of Executive Yuan: up to December 2008, nationwide credit unions average nonperforming loan ratio is equal to 1.24%; the allowance bad debt coverage ratio is 118.24%. In average, the nonperforming loan ratio in nationwide banks is 1.54%, higher than that of credit unions; the allowance bad debt coverage ratio is 69.48%, also lower than the figures for credit unions. This fact demonstrates the quality of sufficient assets in credit unions surpasses the asset quality of banks. Therefore, the scalability does not mean capability; but a profitable financial firm is a good financial institute. A well-performed financial firm is not only profitable, but also responsible to depositors (investors). However, the primary factor to corrode financial firms profit is nonperforming loan. This study mainly focuses on financial firms in Hualien area and the research is divided into two phases. First, based on current literatures and related references, we select some important factors affecting housing loan quality for preliminary dimensions. The first-run questionnaires are filled out by 5 years experience personnel in loans auditing department of financial firms. Based on the feedback of above questionnaires, critical factors of nonperforming loans are selected. The second phase is to design an Analytic Hierarchy Process (AHP) questionnaire by the critical factors selected from the first phase. Moreover, interviews with senior managers (more than ten years credit experience in credit unions) and professors from financial fields are conducted. The Analytic Hierarchy Process is used to handle the questionnaire data and forms results. In conclusion, we generate critical factors of affecting housing loan quality and also ascend the importance by weight ratio. The results of this study may be applied to loans auditing decision-making process and hopefully can be useful reference to other studies and financial institutes.