Case Study Of A Company's ABS Financing Model For Stock Pledged Repurchase

Asset-backed securities originated in the United States in the 1970 s.Currently,the first recognized asset-backed securities was the "pass-through securities" issued by the National Mortgage Association in 1968.It was subsequently used as a means for commercial banks to revitalize liquidity and improve asset allocation efficiency widely used.Especially after the 1980 s,the asset securitization method in the United States was no longer limited to banks,and was gradually used by companies and governments for wider financing.Asset-backed securities have gradually become the fastest growing and most dynamic financial products other than stocks and bonds.On May 23,1997,Chongqing Municipal Government and Asia Guarantee and Haosheng ABS(China)Holdings signed China's first urban construction-based ABS plan cooperation agreement,which kicked off the development of asset-backed securities in China in 2019 From March 3 to March 3,2020,there were 1,511 stocks of asset-backed securities in China,with a total issuance of 24.24 trillion yuan and a balance of 20.53 trillion yuan.The stock products increased by 45.85% from the 1036 in the previous statistical cycle.The total amount increased by 16.15% from 20.87 trillion in the previous statistical cycle,and the balance increased by 97.21% from10.41 trillion in the previous statistical cycle.This article uses a combination of case study method,qualitative research method,and quantitative research method.First,through theoretical analysis of the stock pledged repurchase ABS financing model,the theoretical basis of the T company's stock pledged repurchase ABS financing model is studied.Secondly,through the main components in the design of ABS products,a comprehensive study of the current status of ABS financing model of T company's stock pledged repurchase.Based on the reasons for choosing the financing model,the characteristicsof the stock pledged repurchase ABS,and the operation effect of the T company's stock pledged repurchase ABS financing model,it analyzes the case,and then puts forward the problems existing in the T company's stock pledged repurchase ABS financing model.Finally,drawing on the successful and well-run experience of issuing ABS at home and abroad,from the two aspects of risk control system and credit evaluation method,put forward suggestions for optimizing the ABS financing model of T company's stock pledged repo,and explore the issue of pledged repurchase of stocks issued by companies in the same industry.Significance of ABS.The conclusions of the thesis research are as follows:(1)Among the many financing channels of enterprises,the issue of asset securitization products has the advantages of lower costs and relatively higher returns.At the same time,asset securitization products can also help enterprises to transfer risks and increase cash flow.In terms of the issuance of financial products,asset securitization also has a variety of characteristics for the choice of basic assets.(2)While Company T has many advantages in the use of stock pledged repurchase asset securitization,it also has occurred,such as incomplete risk control system;single credit evaluation agency;higher risk of basic assets;weaker cash flow recovery ability Defects.(3)It has very important enlightenment on the issue of pledged repurchase of stocks issued by the same industry in terms of transaction structure and risk management.Based on the research conclusions of the above papers,the following suggestions are put forward:(1)Establish a strict risk control system within the company.The internal risk management system of the company often has a greater role than the external review system.The internal risk management must follow: Separation,independent risk control ",while improving the accountability system.(2)Improve the credit evaluation system.Credit evaluation reports should be made public.At the same time,reference to laws and accounting due diligence reports can be added to credit evaluation.(3)The selection of high-quality basic assets.The expected return and measurability of the underlying assets of asset securitization products are very important.In selecting the basic assets,the estimated recoverable cash flow of the asset should be fully evaluated.(4)Enhance the cash flow recovery capability.Cash flow is an important guarantee for the repayment of principal and interest on assetsecuritization products.Once cash flow problems occur,the product will be overdue or defaulted.