Research On China's Commercial Banks Assets Securitization

Quality of bank assets is a decisive factor that affects the quality of bank management.All along,how to effectively dispose of non-performing assets is a problem plaguing the world's commercial banks.At present,securitization is becoming an important way to solve this problem.However,in China,non-performing assets securitization is still a new business,not only need accumulating practical experience,but also need more academic researching.In order to realize commercial banks' purpose and deal with the financial risk,this paper discusses the accounting and risk prevention,which is important for commercial banks' enthusiasm and the sustainable development of this business.Based on the historical experience and the analysis of China's non-performing asset securitization,this paper takes Zhongyu first phase of the NPL backed securities case issued by the Bank Of China in 2016 for example,which is first product after the resumption of the non-performing assets securitization launched in 2016,and analyzes product features,obstacles of discontinuing recognition in accounting,the effect and main risk.It is worth to pay attention to the characteristics of product structure and credit risk caused by the characteristics of non-performing assets.Through special transaction terms setting and account arrangement,Zhongyu first phase achieves non-performing assets discontinuing recognition successfully both in consolidated and individual statements level.Through calculation and analysis,Zhongyu improve performance of balance sheet of the Bank Of China in the financial index,capital index and risk index level,and reduce risk weighted assets and release capital.In terms of economic benefits,the most prominent advantage is to break the limits of Asset Management Company and move up cash recovery point.Although the reputation of Zhongyu first phase compares to the overall status of non-performing loans of the Bank Of China is small,but its efficiency is significantly,its main significance is that it is a successful experience and precedent and it expand disposal channels of non-performing assets,and plays a reference for the follow-up non-performing asset securitization business.