State Owned Commercial Banks' Bad Assets Securitization Applying Research

Securitization is the most important innovation of financial instruments in the 20th century. As a new form of raising money and an alternative of investment, it has been one of the striking focuses among financial institutes, China's related ministries and commissions, and other internal and external market participants. It was believed as an efficient means to control the risks of China's financial market and plays an important role in connecting with the international standards. Theoretically speaking, through securitization, our State Owned Commercial Banks can strengthen their assets operation efficiency, and the whole economy resources can be used optically. Realistically speaking, through securitization, our State Owned Commercial Banks can accelerate their disposal efficiency of the bad loans and earn some valuable time for the future transformations. Meanwhile, it provides a new way for the State Owned Commercial Banks to enhance their capital adequacy rate. On the other hand, securitization faces many problems and risks that need to be transformed and innovated, in the aspect of the operation process and the operation environment. Certainly, there are many ways of securitization applying in the process of State Owned Commercial Banks' transformation, however, in this article I will emphasize its application in the disposal of the bad loans.This article falls into five chapters. In the first chapter I generalize the necessity that the State Owned Commercial Banks to take on the securitization. In the second chapter, I mainly introduce the basic principles of securitization. In the third chapter, I state the procedure designing and the market body system in the process of the State Owned Commercial Banks' bad loans securitization. In the fourth chapter, I discuss the problems, risks, and correspondent strategies and suggestions in the process of our State Owned Commercial Banks' securitization. In the fifth chapter, I mainly introduce the securitization practice of our State Owned Commercial Bank and the inspiration to us.