Nowadays, there are many unsolved problem existing in the process of implementing the loan rating methods in issuing bank loans, for example, the reform is far from complete, accounting system and taxation system do not match, capital account of enterprise is not good, hardware of the banks are not sufficient and the staff of the banks are not well trained.

The current of subdivision of five class loan classification in domestic banks appeared recently,and the basis of bank credit management has been greatly changed,so it has got general concern.

The paper is intended to show the gap in loan classification between Chinese banking industry and their foreign counterparts through a comparative analysis and suggest ways to improve.