Research On Securitisation Of Non-performing Assets In Cinda Assets Management Corporation

Non-performing loan(NPL) securitisation of China Cinda Asset Management Company is refered to as: China Cinda Asset Management Company selects those NPL that purchased from state-owned Commercial Banks according to the criteria of less flowability but with steady cash flow in the future, and sold those NPL to a special purpose vehicle (SPV). With a certain structural arrangements and credit enhancement activities, SPV converts those NPL into an asset-backed security(ABS) which are sold to investors in the capital market. NPL securitisation is the most effective method of disposing NPL for China Cinda Asset Management Company. It accelerates Cinda'a pace of NPL disposal, and greatly increasing the recovery rate of NPL..With a series of contracts arrangement, those legal relations could be established by NPL securitisation process among those principal entities, and the rights and obligations of those principal entities also could be indentified. NPL securitisation is both an economic process and a complicated legal process. According to the characteristics of Cinda has enormous amount of NPL,but the speed of NPL disposal is low, and Cinda lacks of effective NPL disposal method, this paper seeks to explain the necessity and feasibility of NPL securitisation of China Cinda Asset Management Company from the following aspects: starting from explaining the concept of NPL securitisation, identifying the main legal entities, and the main objective entities, illustrating the operation procedure of NPL securitisation. In depth analyzes the source of NPL, the scale of NPL, NPL disposal method and NPL disposing speed of China Cinda Asset Management Company , as well as China's NPL market. With the help of case studying of developed courtries'NPL securitisation mode and with the help of well understanding of China's present regulations regarding performing loan securitisation, this paper systematically analyzed issues as"true sale","bankruptcy remoteness", security issuing, security trading related to NPL securitisation, and concluded with the detailed operational method of NPL securitisation under the mode of"true sale".There are four chapters in this paper.. Chapter 1 briefly introduces the main structural and contains of this paper, such as explainations on the concept, main theories and the trend of NPL securitisation. Chapter 2 mainly analyzes the current situation of China Cinda Asset Management Company, regarding NPL's source,...