China National Student Loan Securitization Applied Research

After the higher education cost shared in our country, government takes national students' loan as an important tool to help college student with financial trouble accepting higher education fairly, protect our higher education developed healthy. This policy has a history of about ten years since it took into effect in eight cities' university in1999.Our currency national students' loan policy takes the way of biding,financial allowance and risk compensation to make up the limitation of market mechanism, enlarge the supply of the students' loan to help the penury student finish school. But the factor of the difficulty of student's employment in recent years, the earning on the low side, and the faultiness of the credit system, leads to the high rate of breach of faith. In order to reduce their risk, commercial banks appear "cherish loan" phenomenon, and it make the students' loan with strong policy and commercialization face a dilemma. The national students' loan securitization is a reasonable way from the view of financial innovation to solve those problems.This paper has introduced the basic theory of the asset securitization at first; It is analyzed that the process of policy of our national students' loan, has discussed the property and character of our national students' loan, take apart the difficult situation of the policy deeply and the reason of the difficult situation; it is analyzed the necessity and feasibility of securitization to our national students' loan from the point of financial innovation and efficiency, etc. it is discussed that the operated model of our national students' loan securitization from the different SPV form, the future cash flow, the question of credit increase-grade and grade. Then, analyzed the yield and risk after securitization, the most but not the least, use the improved KMV model to control the credit risks of the our national students' loan securitization, and have a simply demonstration simulation; At last, in order to insure the success of the securitization and go on continuously, it still needs some policies and external environment supported.