Analysis Of The Impact Of Credit Asset Securitization On The Profitability Of Commercial Banks In China

In recent years,the development of asset securitization in our country is very rapid,the issue size is more and more big,the basic types of assets become more abundant,and the trading market has become more active.This is not only because asset-backed securities can provide new financing tools and solve the financing needs,it can also help to increase the liquidity and reduce business risk.Commercial Bank plays a main role in China’s financial system and credit assets-backed securities is one of the three main types,so it’s development is very important to China’s whole asset securitization and capital market.There are various needs for Commercial banks to issue credit asset-backed securities.The main purpose is to increase asset liquidity,revitalize the stock funds,broaden financing channels and reduce operational risks.As a profit-making organization,profit maximization is the ultimate business goal,therefore in the process of the development of commercial bank credit securitization,we should not only focus on capital turnover,we must also pay more attention to its impact on profitability.The current research on the securitization of credit assets of commercial banks are still in the empirical analysis using the foreign data.And the research on the effect focus most on the liquidity and operating stability.For this paper,we use the latest data to discuss the impact of credit asset securitization to commercial banks’ profitability.So as to help commercial banks make better use of credit asset-backed securities and improve profitability.This paper explains the development reasons,development course,operation process and transaction structure of credit asset securitization in our country,and discusses it’s influence on the profitability of commercial banks.Although the credit asset-backed securities can provide benefits,get support of the national policy in our country and is developing very quickly,but through factor analysis and regression analysis in the paper,the conclusion is that it has a negative effect on the profitability of commercial banks in China,and the strength of the credit asset securitization activity is higher,the negative effect is bigger.This is mainly because our country is still in the initial stage of development.The operation process and the transaction structure of credit asset securitization need to be improved,and the issuer is not mature enough to use it.The issue cost is greater than its income.Although the securitization of credit assets has a negative effect on the profitability of commercial banks in our country,we believe that with the improvement of its development,it can eventually help banks improve profits.In this paper,through the research of the operation process and transaction structure,we analyse the cost and benefit factors which have influence on the profitability of commercial banks so as to provide targeted countermeasures and suggestions,so that commercial banks can make better use of credit asset-backed securities and help it improve assets liquidity,reduce business risk and increase profitability.