Motivation And Risk Control Analysis Of Asset Securitization Of Finance Leasing Companies

Since its inception in the 1980 s,China's financial leasing industry has gradually matured with the support of relevant national laws and policies and the industry's self-exploration.But with the need for further expansion,many are facing a shortage of funds.Therefore,in the context of the strengthening of bank supervision and the major reform of accounting,asset securitization has become the best choice for the financial leasing industry to ease the financial pressure and improve the capital structure.This paper selects Far East Horizon,a leading enterprise in the financial leasing industry,as the object of case study,and deeply analyzes the motivation and risk control of Far East Horizon's asset securitization business.Research findings: First,through the analysis of Far East Horizon's financing methods,risk asset equity ratio,finance lease receivables and asset-liability ratio.The reasons for the company to develop asset securitization include breaking through the constraints of traditional financing channels,reducing the ratio of risk assets to equity and dispersing some operational risks,activating existing assets and improving the asset structure.Secondly,after studying the risk of asset securitization of Far East Horizon,it is found that the financial risk of the company after asset securitization is slightly higher than that before asset securitization,but with the development of asset securitization,the risk increase is relatively stable and some indexes tend to get better.From the perspective of asset concentration risk,the industry concentration risk decreases gradually with the expansion of investment field,while the regional concentration risk is relatively low.According to the analysis of liquidity risk,the overall liquidity risk of the company has slightly increased.According to the credit rating,in the context of the overall economic downturn,asset securitization will bring great negative effects to the credit rating of the company.Finally,the paper puts forward some suggestions on the risk control of Far East Horizon: in terms of risk pricing,different interest rates can be set for borrowers with different default probabilities.Strengthen cash flow forecast and planned liquidity.Build a dispersed pool of assets.Construct the payment mode of mixed interest rate.Make appropriate adjustments to credit rating downgrades.It is hoped that the financial leasing company can provide some help when carrying out the financing of asset securitization.