Path Dependence Research On Non-Performing Asset Securitization Of Chinese Commercial Banks

After more than 20 years of reform and opening up, China's economy has made great progress. But it still met lots of problems in the development. The non-performing asset of the state-owned banks is one of the most serious problems. At present, the amount of commercial banks' NPA is huge and most of them belong to state-owned commercial banks. The huge NPA problem is a big hidden trouble which will threaten the country's economic & finance safety and the economy's normal operation. It is an important topic for discussion of Chinese financial system development and economy reform that how to solve those NPA which caused by system and technology effectively. Over the past few years, we have achieved great success in NPA disposal. But the pressure is still tremendous. Thus, it is hot increasingly to find out a new way to dispose the NPA.Asset securitization is a major financing technique which grew up in the financial innovation wave. It has become the most important financial innovation tool which developed most quickly in the finance field of the world. It means the process including structure arrangement of the property which lack mobility but can produce stable cash flow, separating and reorganizing the risks and income of the property, transferring them to the security which can be sold and circulated in the financial market. Non-performing asset securitization (NPAS) is one of the asset securitization. Because NPAS has succeeded in some countries, a lot of people in internal academic and business circle suggest China to do the NPAS. But an advanced economic situation and market system are required for its application to non-performing assets. Whether it is feasible to China or not is a controversial focus. This text begins to research of the NPAS of Chinese state-owned commercial banks by using the path dependence theory innovatively in such a historical background.Applying the path dependence theory and grounded theory, the author firstly analyzed American NPAS development and found out that the key of NPAS's success is the choice of the first path. The NPAS in America focuses on those big amount mortgaged loan which has natural mortgage and produce stable cash flow. Those banks with great bankruptcy risk and bad finance don't use NPAS greatly. Then the author did a deep analysis of the generation, disposal and development of state-owned commercial banks' NPA by using the path dependence theory. The author also compared the condition required by the NPAS and the current condition of China. On this basis, author ratiocinated the possible bath path and consequence of China's NPAS if practice it in current condition to find the problems and give warning. If we implement the NPAS hastily regardless of the bad condition it won't reach the target of NPA disposal, and will create new traps and risks which will cause new credit and liquidity crisis. At last, with the American experience as reference, considering the situation of China, the author put forward the idea that the infrastructure asset securitization can be the first path which can guide the system of asset securitization to the good path. When the condition is mature enough the NPAS with the right asset can be implemented and it will play its due role.By this article, the author hope to provide a new research perspective of Chinese commercial banks' NPAS and try best to analyze the NPAS system deeply by path dependence theory to enrich the research content, offer thesis guidance and research basis of internal NPAS.