Research On The Application Of Asset Securitization In Consumer Finance Companies

At present,resident consumption has become an important economic growth point in China.The Central Economic Work Conference held in December 2018 will clearly promote the formation of a strong domestic consumer market,improve the consumption environment and enhance consumption capacity as the key tasks in the future.Expanding consumer market and promoting consumption ability cannot be separated from the support of consumer financial services.The personal loan service provided by consumer finance companies is one of the important forces of consumer financial services in China.It has always played an important role in promoting residents ‘consumption and improving their consumption ability.Xi Jinping,President of China,emphasized at the collective meeting of the Political Bureau of the CPC at the beginning of 2019 that we should improve financial services,deepen the structural reform of the financial supply side,regard serving people's livelihood as the focus and fundamentality of the financial industry,build a multi-level,wide-coverage and differentiated financial service system,and provide individualized,differentiated and customized financial products.It can be seen that the healthy,sound operation,sustained and stable expansion of consumer finance companies deeply engaged in Inclusive Finance is in line with the current national policy orientation and economic development needs.Due to the regulatory requirements,the financing channels of consumer finance companies in China have been greatly restricted,and the scale of operation is difficult to expand.Asset securitization opens up a new financing way for consumer finance companies,which can effectively solve the financial difficulties.Through securitization,consumer finance companies can convert non-mobile credit assets into real liquidity for business expansion and business needs,which enhances the efficiency of asset use and capital adequacy.Through risk isolation and credit enhancement,consumer financial companies can issue asset-backed securities with high rating,thus reducing the interest rate and financing cost,and providing more preferential loans to consumers.It has important theoretical and practical significance to conduct academic research on asset securitization of consumer financial companies.In this paper,the second issue of personal consumer loan asset-backed securities in Jay Win 2018 is taken as an example to study the application of asset securitization in consumer finance companies.In addition to the introduction and conclusion,the main body of this paper will be divided into four chapters.Chapter one states the basic theory of asset securitization and consumer finance company,defines the related concepts,analyses the motivation of asset securitization of consumer finance company,and expounds the current development situation.Chapter 2 introduces the case,which covers the backgroundof the product's sponsor,the analysis of issuance motivation and the issuance of relating products,as well as the basic elements of the product itself,the transaction structure and the issuance situation.Chapter 3 carries out a case study,which is the focus of this paper.It mainly discusses the basic asset analysis,credit enhancement analysis,cash flow distribution analysis,product risk analysis and case enlightenment,covering the main features and innovations of the case.Chapter four summarizes the problems existing in asset securitization of consumer finance companies and puts forward relevant suggestions.In view of the insufficiency of the case,starting from the business itself and the external environment,this paper proposes four ways to optimize the asset securitization project of consumer finance companies.This paper conducts literature research,case study and data analysis,through the combination of theory and practical cases,aims to systematically study the application of asset securitization business in consumer finance companies.The research in this paper expands the scope and perspective of asset securitization research,provides academic support for the field of practice,and also provides new ideas and directions for future asset securitization research.Restricted by the lack of public information and data,this paper mainly conducts qualitative research.In the future,with the increase of issuance quantity and the expansion of issuance scale of asset securitization products of consumer financial companies,more and more statistical data will be available.At that time,we can conduct in-depth quantitative research on asset-backed securities pricing,risk modeling and economic effects,and enrich the existing problems.Research results to optimize the current business model.