An Analysis On The Practice Of Non-performing Assets Securitization Of Commercial Banks

Asset-Backed Securitization(ABS)is an innovative way for commercial banks to dispose of non-performing assets.China began to explore the Non-Performing Assets Securitization(NPAS)in 2005,and was interrupted by the global financial crisis in 2008.In February 2016,China restarted NPAS,and approved the trial of 6 commercial banks.The characteristics and improvements of new round of NPAS deserve our further study.Based on literature and theory about asset securitization,this paper introduces the present situation of the non-performing assets in domestic commercial banks,the ways of dealing with them and the practice of NPAS.By describing “Nong Ying2016-1” in detail,this paper analysis this case from the aspects of motivation,transaction structure,risk,pricing and effect.The study has found that "Nong Ying2016-1" has the advantages of high mortgage rate of basic assets,reasonable arrangement of trading structure and high yield in similar products.However,there are some problems,such as higher concentration of basic assets,the risk of assets disposal and the financial effects is not obvious in short terms.Based on the analyses and summary of “Nong Ying2016-1”,this paper gives some political advice at the aspect of system,market and risk,for instance,improving laws and accounting system;making the threshold of qualified investor lower;promoting the construction of the liquidity market;enhancing risk management;improving the information disclosure system;improving the service capacity of participating institutions.