Study On Securitization Model Of Local Government Financing Platform Loan

At the end of2008, in response to the negative influence of the US subprime crisis to our country, the State Council issued the4trillion economic stimulus plan, this caused a huge investment impulse of local government. As of June2013, the loan balance of local government platform is4.075554trillion yuan, accounting for about7%of GDP, most of these loans from commercial bank loans. A lot of loans of the local government platform not only affect the economic steady development of our country, also may endanger the safety of the financial system in our country. Asset securitization is of great significance to solve these risks. In particular, for those good projects who are able to generate stable cash flow in the future, commercial bank’s loans of those projects meet the requirements of the underlying asset through asset securitization, securitization can solve the problem that the platform of local government lack of financing channels and the risk hard to be scattered, In addition,it can guide the private capital and social capital to investment in the medium and long-term infrastructure projects, it achieves the optimal allocation of social resources. This paper is to study the securitization model of local government financing platform loan.First of all, the paper makes detailed analysis from the nature and risk of the loans of the local government platform, lays the foundation for securitization model of local government financing platform loan. Among them, the loans of the local government platform in our country are discussed from two aspects of inevitability and necessity respectively. The risk of the loans of the local government platform are discussed from three aspects of macroscopic economy, local government, commercial banks respectively.Secondly, the paper demonstrates the necessity of the securitization of loans of the local government platform from four aspects of local governments, commercial Banks, investors, financial markets,the paper demonstrates the feasibility of the securitization of loans of the local government platform from two aspects of internal and external financial environment.Again, the paper analyses two kinds of asset securitization mode, in combination with the characteristics of loans of local government platform, come to the suitable securitization model for the loans of local government platform, that is the cash model.Then, in the operating level, the paper makes a detailed analysis from the sponsor of the securitization, SPV mode, underlying assets, credit enhancement measures and risk management and so on. Finally,the paper propose some policy suggestions from the macro and micro two aspects respectively.