Dissertation > Economic > Fiscal, monetary > Finance, banking > China's financial,banking > Credit > Infrastructure credit

Credit Risk Assessment of Power Projects

Author YiShuGang
Tutor ZhangFangJie
School Shandong University
Course Project Management
Keywords project credit risk assessment system AHP
CLC F832.41
Type Master's thesis
Year 2011
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Commercial bank plays an important role as financing connection in national economy and social development. It is a fundamental guarantee for economic and social development. Credit service is one of the basic services in commercial banks, which is an important way for profits. As a fundamental solution for big companies and projects’financing, project financing has been a cardinal credit service in commercial banks. Project financing has special character, which makes it be different from ordinary credit services. On the one hand, project financing offers financial support to large companies, which promotes construction of large projects including infrastructure projects. On the other hand, there is a great deal of cash flow and the project’s risk is concentrated on fixed company. If default happens, there will be big loss in commercial bank and it will hamper the development of bank. Therefore, risk recognition, risk evaluation and risk early-warning are significant for commercial banks. The assessment of project financing is especially important in project financing management. And the basic analysis of assessment is to develop and establish the system of assessment indicators in project risk.In this paper the author analyzes 2x1000MW power project in Huaneng Laiwu Power Company. The author analyzes how to establish risk assessment and evaluation system in power project financing. Firstly, the author uses Delphi Method and AHP to assign different weights to indicators. Next step is using comprehensive score analysis, BEP and sensitivity analysis to attain assessment. Finally, the author concludes risk control solutions.The central content of this paper are as follows:The first part is the introduction. The author suggests problems, the purpose of research and the methods in research. The second part is literature review where the author concludes existing research papers. The third part is to introduce the basic information of project financing and project financing risk. Besides, the author analyzes character and risk in power companies’project financing. The fourth part is to establish project financing evaluation systems in two levels. In this part the author makes sure every indicator’s weight, criterion of project judgment and criterion of project risk level judgment. The fifth part is to analyze 2×1000MW power project in Huaneng Laiwu Power Company. Firstly, the author uses the system of assessment indicators and correlated criteria to do systematic analysis. Then the author uses other methods such as sensitivity analysis and BEP to do analysis. Finally, the author attains comprehensive assessment. The sixth part is to put forward risk control solutions. The sixth part is the conclusion of this paper.

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