The Impact Of Credit Asset Securitization On The Liquidity Risk Management Of Commercial Banks

Because of reform and opening in last 40 years,the overall economic structure of the country has become increasingly complex.With the expansion of direct financing in the financial market,the potential liquidity risks faced by commercial banks have been continuously magnified.The issue of liquidity is the most critical indicator of the long-term development of commercial banks,and the “contagious” nature of liquidity issues determines that when large-scale banks have liquidity risks,the entire financial market will also be turbulent.The global financial system may experience a serious crisis.Therefore,timely and appropriate response to the bank's liquidity risk is particularly important in the current environment.Securitization of credit assets was used as a tool to manage liquidity since its inception.Since China restarted the pilot work of securitization business in 2012,the scale of securitization has continued to expand.The paper mainly studies whether securitization can have a certain effect on the liquidity risk of the management for banks.The first part of the paper discusses the connotation and influencing factors of liquidity risk.It discusses the current methods used by the domestic banking industry to monitor and manage liquidity risks.The second part mainly discusses how securitization affects the liquidity risk of banks.After describing the definition of securitization and the structure of transactions,Ianalyzed how securitization affects liquidity risk.The relevant influences are mainly reflected in three aspects: reducing the scale of risky assets,resolving the misallocation of bank assets and liabilities,and improving bank financing capacity.At the same time,it also focused on the current practice of securitization business in China.Combined with the analysis of the first two parts,it provides a basis for the third part of quantitative research to provide research models such as selection models and variables.The empirical part mainly uses half-year data from the financial data of19 commercial banks in the country during the period of 2012-2017 as a sample to conduct research.Referring to Loutskina's asset securitization index(including individual bank loan structure and financial market securitization product scale)in2011 as an independent variable,the ratio of liquidity and loan-to-deposit ratio were used as dependent variables.At the same time,the bank's asset size,net interest income ratio,asset equity ratio,and non-performing loan ratio are considered as control variables to construct a model.Empirical results show that the increase in bank securitization leads to an increase in liquidity.The use of alternative independent variables to test the robustness of bank securitization services further enhances the robustness of the empirical findings.The last part of the fourth section summarizes the foregoing content and makes recommendations.Asset securitization can increase the intra-bank liquidity of commercial banks because it provides an effective channel for depository institutions to convert stock loans into liquid securities.Banks can increase the liquidity of their own credit assets through securitization operations,thereby reducing the sensitivity to external influences.