The Study On Non-performing Loans Securitization Of Commercial Banks

As a major innovation in the twentieth Century world financial industry,Asset Backed Securitization(ABS)is an ideal tool to pack the illiquid assets to securities,to improve liquidity of asset owners,realize risk-remote mechanism,and improve the efficiency of capital use.Internationally,ABS is widely regarded as one of the effective financial instruments to solve the non-performing loans of commercial banks.China’s commercial banks have huge volume assets and have amassed great amount of non-performing assets.Facing the economic downturn,non-performing rate of the major commercial banks have increased,even reached new highs,brought hitherto unknown challenge to banks management,influence the stability of the financial industry,has attracted the attention of regulators.At present,the main way to deal with non-performing assets of domestic commercial banks is to pack the assets to the four Asset Management Co or through judicial auction.But the above means are far from perfect,banks thirst for new tools to digest the non-performing assets in a shorter time with better price.The author believes that ABS as a financial instrument will open a new channel for China’s commercial banks to dispose the non-performing assets.Therefore,it is of great theoretical and practical significance to summarize the theory and practice of asset securitization.This paper firstly analyzes the present situation of the domestic commercial bank non-performing asset securitization;secondly,explains the mechanism of asset securitization.After exploring the mechanism of ABS,this paper discusses operation process of China’s commercial banks non-performing assets securitization.Then this paper analyses the restricting factors of China’s commercial bank non-performing asset securitization.At last,this paper gives advices to solve the factors that restrict non-performing asset securitization.