Research On The Motivations Of Commercial Banks' Credit Asset Securitization In China

In 2012,China's credit asset securitization pilot was restarted.Since then,it has developed rapidly and gradually moved toward normalization.Under this background,there is an increasing concern of the motivations of bank securitization.The existing securitization motivation theories at home and abroad include acquiring liquidity,transferring risk,regulatory capital arbitrage and improving profitability.At present,the development of credit asset securitization in China is still in its infancy.Banks' securitization products have a small share in the bond market and its market size is insufficient,also the basic assets are mostly limited to high-quality assets.Given these characteristics,the motivations for securitization initiated by Chinese banks need to be analyzed concretely.In addition,in 2015,the issuance examination of credit asset securitization was changed from "China Banking Regulatory Commission(CBRC)+People's Bank of China(PBOC)dual examination and approval" to "CBRC filing+PBOC registration" mode,which simplified the issuance management process,improved the issuance management efficiency,and helped banks to sponsor securitization independently according to business needs.The change in the issuance management mode reflects that the regulatory policy was changed from strict to loose.According to this,the paper divides the development of China's credit asset securitization since the restart into the initial stage and the normalization stage.Due to different policy backgrounds,the motivations of bank securitization in the two stages may be different.So what are the motivations of bank securitization in the pilot restart initial stage and the normalization stage respectively? What's the difference between them? How did the policy change affect the motivation of securitization? Further research is needed.Firstly,this paper reviews the research concerning motivations of commercial banks' credit asset securitization at home and abroad.Secondly,the paper analyzes the development status of credit asset securitization in China,clarifies the development stage and the development characteristics.Then,the paper explains the existing motivation theory at home and abroad.On this basis,combined with the development status of China's credit asset securitization,the paper analyzes the possible motivations of bank securitization in China theoretically.Next,the paper takes 83 commercial banks who had securitization practice during 2012-2018 as research objects,and constructs the Logit model and the Tobit model to conduct empirical analysis of the securitization motivations of China's banks in the pilot restart initial stage(2012-2014)and normalization stage(2015-2018).The empirical results show that in the initial stage,the business innovation is found to be the main cause of bank securitization.Banks with higher capital adequacy ratio are more likely to securitize and have larger scale of securitization;in the normalization stage,the acquisition of liquidity and business innovation are the main motivations of bank securitization.For small and medium banks,regulatory capital arbitrage is also the driver for securitization choice and banks with stronger profitability have greater scale of securitization.There is a significant difference in the motivation of securitization between the initial stage and normalization stage.Under the background of looser policies in the normalization stage,banks began to securitize for liquidity need.In addition,small and medium banks also securitize for regulatory capital arbitrage.Therefore,the relaxation of policies promotes the development of securitization toward marketization.Finally,combined with the development of bank asset securitization and the empirical conclusions,this paper proposes several improvement suggestions.