Study On The Impact Of Credit Asset Securitization On Commercial Banks’ Profitability

The acceleration of the interest rate market reform process has led to a low interest rate environment for commercial banks.The strong regulatory effect and competition from non-bank financial institutions have again squeezed the profitability of commercial banks,and there are internal factors such as their own operational inefficiency and high costs,commercial banks are in urgent need of new financing models.The emergence of credit asset securitization business has given commercial banks a new financing model by pooling loans and other assets to create securitized products that can be sold to investors,which enables commercial banks to raise capital and reduce risk exposure,and is very important for enhancing commercial banks’ profitability.Therefore,in the current economic situation,it is important to study the impact of credit asset securitization business on the profitability of commercial banks.This paper investigates the impact of credit asset securitization business on commercial banks’ profitability and the specific path of this impact,and proposes six hypotheses that credit asset securitization business will enhance commercial banks’ profitability.To test the hypotheses,an empirical study was first conducted by factor analysis and regression analysis;then the 78 sample banks were classified according to the size of assets and the nature of banks to study the heterogeneous effects of securitization business and credit asset securitization ratio on commercial banks’ profitability;finally,a mediation effect model was adopted to study the mediation effect of deposit to loan ratio between securitization business and commercial banks’ profitability.The results show that: i.credit asset securitization has a positive impact on the profitability of commercial banks,and the larger the scale of credit asset securitization business of commercial banks,the more obvious the improvement on profitability;ii.there is indeed heterogeneity in the impact of credit asset securitization business on the profitability of different types of commercial banks,and it has a significant effect on the profitability of small-scale commercial banks and urban commercial banks;iii.securitization business can increase liquid assets and broaden financing channels by alleviating the liquidity maturity mismatch problem of commercial banks,thus indirectly improving the profitability of commercial banks.Finally,based on the above findings,in order to better promote the development of commercial banks’ credit asset securitization business,relevant suggestions are proposed for commercial banks and financial system regulators,respectively.