Analysis On The Cause Of The Mortgage-backed Securitization Development And The Choice Of China

Mortgage-backed securitization is one of the most important innovations in international finance since 1970's. It has not only changed the way of housing finance in America and other countries greatly, but also brought about a series of system innovation, market innovation and technology innovation. Mortgage-backed securitization is also one of the most vigorous finance products in international capital market.Though it is not long for the house mortgage-backed loan to be operated in China, it has been developing fast. In recent years it has been increasing at about double-digital speed. The balance of the house mortgage-backed loan in the whole mainland is one thousand and six hundred billion RMB in February 2005. But the figure was only thirty-five billion RMB in June 1998. In the present there are also about 50% loans which are mortgaged by the real estate in the whole balance of loan in the finance system in the mainland. A coin always has its two sides. The high speed may also induce hazard which will harm the whole economy. We should prepare for foul in fair weather and find a solution to resolve problem. Mortgage-backed securitization is one of the feasible choices.Mortgage-backed securitization has presented different situation in many countries because the conditions differ from any other countries. We should analyze the cause or the inducement of the development of the mortgage-backed securitization in other countries systemically, and try to find why it happened and succeeded in this country and failed in any other country. Then we can learn from their experience and avoid the risk and localize the Mortgage-backed securitization.Firstly, the paper introduces concepts of asset securitization and mortgage-backed securitization. Then it compares the developing situation in typical countries in macro, moderate and micro ways, and gains some conclusions. That is mortgage-backed securitization was invented and developed in a certain condition including society, economy and politics. In this base, the paper analyzes present situation in our country, and concludes that mortgage-backed securitization will be successfully exercised in proper strategy.