The Method Exploration Of PPP ABS Pricing

Since 2013,China has carried out the PPP model in the infrastructure construction,hospitals,schools and other capital investment projects which are basically in charge of investment by the government.We hope to get social capital support and let the society participate in the operation of the project to improve the operation efficiency.However,due to the large capital demand and low profit factor,participants can not recover their investment in the short term,so the PPP model project is difficult to land.In order to solve this problem,in December 2016,the joint securities supervision committee of the national development and Reform Commission launched the asset securitization of the PPP project,which facilitates the social participation of the participants to complete the capital withdrawal and reclaim the investment,and also allows more people to participate in more projects to gain the benefits of the project.The development time of PPP asset securitization products is less than one year.As of November 2017,six PPP item assets securitization products have been issued successfully in the capital market.Asset securitization is no longer new in China,but it is still not mature enough.The article explores the key link of PPP asset securitization-product pricing.In this paper,the comparative analysis method is used to study and compare the pricing methods of asset securitization products which are more suitable for PPP projects.It is found that under the condition of low market maturity,simple design of asset securitization products of PPP project,short term,and the use of credit rating contrast difference between other asset securitization products.The method of interest spread(SS)+ option pricing is applicable to the pricing of asset securitization products of PPP projects in China.Finally,through the case analysis of the pricing of the first PPP-ABS product new water source ABS in China,th e empirical results show that the long term 03-10 product spread exceeds the credit rating other asset securitization products.which is not fit for the market’s confidence in the new product,and Verifies the products calculated by the static difference method(SS)+ option pricing.The value is in accordance with the actual situation.At the end of the article,the author considers that the static difference method(SS)+ option pricing is a good way of pricing PPP asset securitization products in China.and makes policy suggestions and future prospects of this research.