The Study On Effect Of Asset Securitization's External Credit Enhancement

As a new financial instrument, asset-backed securitization has been widely used and become the most dynamic financial system innovation in the international financial markets. While the asset-backed securitization has triggered the sub-prime crisis in the United States, but we should realize that it can not be judged in itself, depending on the method we choose. Due to the excessive, indiscriminate development, it caused the crisis.Following entrance of WTO, everybody recognizes the importance of financial reforming and opening to the world more quickly in our country. The implementation of asset-backed securitization has a positive significance to China's financial system: broadening the finance channels effectively and improving the ability of finance capital in domestic financial market, reducing the transaction cost of financing and improve the relatively low efficiency of financial system. ABS is not a process of accumulation of risks, but a process of scattering the risk in the real economy and banking system. China should sum up lessons in the U.S sub-prime crisis, strengthen the theoretical study and seize the opportunity to keep in line with the international financial steadily.However, credit enhancement which is one of the key techniques of asset-backed securitization is lack of theoretical research. Avoiding complicated financial deal, we analyze the result and take the empirical study for the effect to the credit providers and credit demand parties after the implementation of the external credit enhancement in this paper. First, we introduce the history, basic concept and the four techniques of asset-backed securitization, and summary the research status quo of asset-backed securitization at home and abroad. Second, we define the four key variables: enterprise reputation, purchase willingness of investor, perceived guarantee degree by investors and brand trust degree, and design the measure index of them. Based on the research of the past, we propose two hypothesis. Then, based on the survey data, we process each of the four variables with the statistical analysis and they carry out the correlation and regression analysis between their relationships to verify the two assumptions proposed before. At last, we obtain the subject of the paper through the logic method. We also propose the shortcoming of the study and take a outlook for it.