| The Non-performing Assets (hereinafter refered as NPAs) of banks can bring a great shock to the security of financial system.Take several financial crisis for example, it could be easily found that the NPAs is so closely associated with financial crisis, even it can de called as the"shadows"of the financial crisis. Lots of the NPAs will hider the normal operation of banks which will further influet the whole capital market and finally ruin the financial system. Lots of countries have had more or less experiences on disposing the NPAs. Especially US, which is the earliest and most successful country to dispose the NPAs of banks. And its method of diposing NPAs has been imitated by many other countries. The article makes a comparation between US and China about disposing the NPAs of banks and point out the relative legal issues in the process of disposing the NPAs of banks in both the two countries. This article has about 28000 words, totally it can be divided into five parts.The first part defines the conception of the NPAs of banks, describes the characterisics and the classification of NPAs of banks in US and China. Also, the present conditions of the NPAs of banks in both the two countries is described in the first part. The NPAs of banks is the assets that can't bring revenue to banks. The banks have to take risks of it's uncovered assets. Through continuous improvement, China's current classification of NPAs of banks, as same as the classification in US, is the method of "five-category loan classification". The NPAs of banks are classified into five categories: normal, concerned, doubted and damnified. These five grades, respectively, reveal the different levels of the risks on loans. After the disposal by government and RTC, the NPAs generated by the financial crisis in 1980s, has been cleaned. However, NPAs are still piled up. Particularly the US financial crisis in 2007 has produced a large number of NPAs. As concerned for China, the NPAs that generated before 1990s has been under control, through the government's measures and the efforts of AMC. However, the US financial crisis has great impact on China's economic, cause difficulties to manufacturings in eastern region. A large number of private enterprises defaulted loans, the NPAs of banking sector increased.The second part makes a deep research into the reasons of NPAs in the two countries,which is the basis for serching the fundamental issues of NPAs of banks. Regulations on the US Savings and Loan institutions were not very strict. The Savings and Loan institutions themselves had formed a feature of "short deposits but long loans ", and because the relaxation of regulation, finally cause the concentration of risks and ultimately exposed the shortcomings of their systems, then,triggered the financial crisis in the banking sector. As in the 20th century, the market mechanisms in China are not sound enough that caused an unreasonable allocation of bank loans. Improper government intervention in the banking sector and the relevant backward legal system, low levels of corporation's management, the bank's lack of qualified practitioners as well as the imcomplete credit system, all of these factors increases the risk of the banking sector, eventually leading to accumulation of a large number of NPAs.The third part, from the angle of"how to handle the NPAs", elaborates the methods of disposing the NPAs in the two countries. And highlights two institutions: RTC (the US Trust disposal company) and AMC (China financial assets management companies), which is the special institutions to dispose the NPAs in US and China. And in this part, it expatiates the means of RTC and AMC, and makes a comparation between the two countries, then point out the defect of the disposal mode in China.The fourth part, has an analysis on the legal environment of disposing the NPAs of the two countries and the specific operation of disposal. There are differences on the legal environment between the two countries. US has made an early emphasis on NPAs in banking sector, and give full legal support and protection to the disposal of NPAs as well as the institution which actualize the disposal. The disposal of NPAs in China is still in an uncertain legal environment, the relevant legislations need to be further improved. Based on the former studied models of the disposal of the two countries, this part analyzes the problem existed in operations of disposal in the two countries, specifically highlighted as four aspects: the assets management agreement, the acquirig and trading of NPAs, the securitization of NPAs and debt-equity swap.The fifth part, on the base of the former four parts and after comparing with US, provides some legal suggestions about disposing the NPAs of banks in China. First of all, the legislation on the disposal of NPAs in the banking sector is lagging behind, therefore, China should first improve the relevent legislation on the disposal of NPAs. Innovations of this article is to propose comprehensive legislation on asset-securitization and debt-equity swap. asset-securitization and debt-equity swap for the disposal of the NPAs are the two kinds of means which more commonly used. But the legislation has lagged far behind, the actual operation even in conflict with the existing laws and regulations, which need to be improved and perfected. It will be of great significance for our country to improve the legislation on disposal of the NPAs.The history and experience can make strong enlightment for the future. It's a great worth to summarize and learn form the history, then on this basement, we can must improve the legal mechanism. |
