Asset Management Companies In China Of Non-performing Assets Securitization Empirical Analysis

In the early 1970s, securitization was principally an American financing technique. Since then, securitization has spread to other countries, seeking to advance their financing frontiers. As one of the most important financial innovations, the principle of securitization is desired to be employed in the management of the bad assets, called Non-Performing Loan (NPL) securitization.As one of the most important financial innovations, the principle of securitization is desired to be employed in the management of the bad assets, called Non-Performing Loan (NPL) securitization. It means we can sell the bad asset in the capital market by issuing securities tools, and separate the profit and risk of the asset. This method is helpful for the AMCs to solve the problem of large amount of bad assets.In this paper, the writer analyzes the effects of NPL securitization of China AMCs by employing case analysis. The importance and innovation of this paper rest on the fact that this paper analyzes the achievement of China AMCs' NPL securitization with the help of the latest real NPL securitization deals from two of 4 AMCs in China, including 'Dongyuan 2006-1 NPL ABS and Xinyuan 2006-1 NPL ABS'. The aim is to summarize the characteristics of contemporary AMCs' NPL securitization and the application of securitization theory in China as well as the reasons and realistic effects of the features of NPL securitization in China. Therefore, the writer brings up some problems existing in the models of NPL securitization in China and consequently comes up with corresponding improving suggestions.