From The U.s. Subprime Crisis, Mortgage-backed Securities Risk Prevention

At the beginning of 2007, the crisis of Sub-prime Mortgage happened, and consequently impacted the international financial markets and global economy, led to economic downturn worldwide in the end. It reveals that as one of the finance creative tools, Mortgage-backed Securities is supposed to be the vital tool for the finance institutes to reduce risks and acquire funds, however, the complex procedure of Mortgage-Backed Securities increases the risks which can not been avoided at the same time. On the ground of the notable influence of this disaster, it's emergence for national market which is still in the original step to enhance the research of controling and soluting the risks.Based on the research of tenets, procedures and the mechanism of the risk transmission of mortgage-backed securities, this paper, at the exposure of the crisis, selects several relevant institutions to gather data, analyzes the risks in the links including purchase, assets-management, bond-design, bond-issue and deal, deeply studies in the risk transmission of the crisis of Sub-prime Mortgage.Combined with the mortgage balance and distribution of commercial bank in China, this paper, analyzes the indication caused by Sub-prime Mortgage in USA, purposes the potential problems and their solutions in Chinese mortgage-backed Securities issues.