Capital Movements In Financial Asset Management Companies, Financial Research

In order to dispose of the non-performing loan (NPL), the Chinese government set up one after another four state-owned asset management corporations (AMCs) in 1999,which are Cinda, Great Wall, Orient, and Huarong. After three years' development, the four AMCs have got great achievement, but they still have some problems. For promoting the development of the AMCs, I study the related problems of the AMCs from the view of finance.The essay consists of six chapters, and it is organized as follows .In chapter 1 I discuss the background of the four AMCs, affirm the achievement obtained in the last three years, point out the problems that still exist, and I also discuss the purport of studying the AMCs from the view of finance. In chapter 2 I analyze the characteristics of the AMCs and confirm the opinion that the AMCs should reconstruct their operation target and finance target. In chapter 3 I analyze the scope of the NPL from the four state-owned Banks to AMCs, and the necessity and feasibility of the next carving of NPL in the four state-owned Banks. At last, I discuss the work of managing the NPL in the four AMCs. In chapter 4, by analyzing the cash flow chain of the four AMCs, I hold that the NPL Securitization will become the new way of money raising for the four AMCs, and make detailed research into the process of the NPL Securitization. In chapter 5,the way the AMCs manage the equity assets they owned is explored. In this chapter, I establish the theory frame of financial governance based on the financial rights. According to this theory, the four AMCs can establish the financial governance of the debt-equity-swap enterprises. In chapter 6,the trend that the AMCs will become the professional investment banks in the future is discussed.The main innovation of this essay is that it reconstructs the operation and finance target of AMCs, beginning with the practice and policy of AMCs. The short operation target of AMCs is to dispose NPL as soon as possible and reduce the loss as little as possible. Beginning with the strategic layout adjustment of national economy, the long strategic target of AMCs is to prompt the state-owned enterprises to improve their corporate governance so as to realize the objective of maintenance and increase of state-owned assets. According to the operation characteristics and long strategic target of AMCs, the generalfinance target of AMCs is to prompt state-owned enterprises to improve their financial governance so as to realize the objective of maintenance and increase of state-owned assets. To achieve the general finance target of AMCs, their particular finance target should be to dispose NPL efficiently, change the uncertain cash flow and try to minimize the loss of NPL and maximize the increase of cash flow.