A Case Study Of Non-performing Assets Securitization In Zheshang Bank

With the rising debts of government departments,enterprises and residents in recent years,there are many “minefields” in the seemingly prosperous economic development.The most direct performance is the continuous deterioration of the indicators of non-performing assets for various commercial banks.Solving such problems cannot be completely dependent on the old path,but also opens up new methods.Since asset securitization products can effectively remove risks from banks and have a high degree of marketization,accelerating the development of non-performing asset securitization products will become a reliable means for all types of banks in China to alleviate the pressure of non-performing assets.Since the restart of non-performing asset securitization products in 2016,the market has issued 52 products,and the market responded well,by the end of the second quarter of 2018.The paper is based on the case,which is named “Zhenjin 2017 First Phase Nonperforming Assets Backed Securities” and issued by Zheshang Bank in December 2017.The reasons for choosing this product mainly include two points: First,the product has issued for one year,so it can be compared with the previously released products,and have relatively complete information.Secondly,the product is more typical and is the first product launched by the joint-stock commercial bank,so as to alleviate the pressure of nonperforming loans.In order to evaluate the effect,this paper analyzes mainly from the perspectives of fund pool analysis,credit enhancement measures analysis and nonperforming asset accounting table feasibility analysis,to study the design characteristics of the product and whether it can meet the conditions of non-performing assets.Through the study of the above angles,it is found that the structure of the product can achieve the purpose for accounting and the credit enhancement measures in the product design can better guarantee the principal and interest of the priority bonds,but the construction of the asset pool is not scattered enough,which will lead to the risk of subordinated bonds increases.Therefore,for the pilot to be started,at the micro level,it is recommended to pay attention to the dispersion of asset pools in industries and regions,to innovate the establishment of special subjects,and to learn from the credit enhancement measures in this product;at the macro level,it is recommended to liberalize the scope of the pilot,incorporating city commercial banks and rural commercial banks.it is also recommended to relax the strict regulations on asset securitization in laws and regulations,and to provide strict supervision to intermediary service agencies.