Study On Mortgage-backed Securitization Between China And Korea

Mortgage-backed Securitization (MBS) is one of the ways in AssetSecuritization. For several decades, it has become a focus of public attention andmore and more countries adopted this system.Two or more holder of mortgage loan form a pool of mortgage loan, And thenthose holders sell mortgage pool to conduit, the Special Purpose vehicle (SPV). SPVissue securities with that mortgage loan as collateral, and sell to investors. At lastdivide the profits produced from the very asset, mortgage loan to investors.As use the way of securitization, MBS can reduce or shift the many risks,comparatively resolve the asset liquidity problem, create new credit, be helpful toimprove the people's life quality and develop the housing industry. "Reorganizationof asset pool", "Risk remote", "credit enhancement" are the core principles of MBS.Since Korea fell into financial crisis, many companies and banks were facedwith Nonperforming Loan problem, especially in real estate asset. To preventbankruptcy, promote effective reorganization and improve financial structure ofenterprises and financial institutions, the Korean government enacted related laws.Those laws, however, gave priority to dispose Nonperforming Loan and did not haveenough advance preparations, used a means of special regulations, with the result thatconflicted with other existing law and system.MBS recently become a hot issue in China, but there are legal and systematichindrances. And the housing financial market is undeveloped. What kind of waysshould be adopted to establish SPV, and how to realize bankruptcy remote and truesale, how to develop housing related financial market.I think it is necessary that the government play a leading role to carry out MBS.It is proper to adopt real estate invest trust way in SPV at first. It deserves to emphasis, the system itself is not the most important thing, buthow to practice constant attention and how to guaranty continuous self-reform is thekey point.