Greentown Group Reverse Factoring Asset Securitization Case Study

In recent years,the regulatory authorities have increased the regulation of real estate companies,resulting in the restriction of their various financing channels,and real estate companies are facing greater financial pressure.At the same time,national policies encourage companies to use supply chain finance and asset securitization for financing.Based on the above background,the new financing model of reverse factoring asset securities came into being.In July 2016,Vanke issued the first reverse factoring asset securitization product.Since then,this new financing model has achieved good development in the market,but it also has certain risks.Because of its late appearance,the relevant research is not deep enough,and it mostly from the perspective of commercial banks or small and medium-sized enterprises.Therefore,based on the perspective of core enterprises and combined with specific cases,this paper discusses the effect of reverse factoring asset securitization financing by core enterprises and the risk factors existing in this financing model.It has a certain driving effect in promoting enterprises to optimize financing methods,reduce financing costs,prevent financing risks and many other aspects.The research in this paper has certain theoretical significance and practical significance.On the basis of expounding the basic principles of asset securitization and related theories,this paper selects the “Greentown No.1 2019-1” special plan issued by the housing enterprise Greentown Group for case studies from the perspective of core enterprises.Firstly,it analyzed the motivation of Greentown Group to use reverse factoring asset securitization for financing,which can be summarized into four aspects:the support of national policies,the capital demand for expanding the scale,the demand for adjusting the payment rhythm of accounts payable,and the demand for expanding financing channels.It also introduced the general situation of Greentown Group’s reverse factoring asset securitization case.Then,the effect of Greentown Group’s reverse factoring asset securitization is analyzed from both financial and non-financial aspects.It can be found that it not only produces positive financial effects such as reducing financing costs,optimizing the structure of interest-bearing liabilities,alleviating debt repayment pressure,and improving cash flow conditions,but also has positive effects in non-financial aspects,which is embodied in four aspects: optimizing the financing model,enhancing the value of the supply chain,promoting the integration of industry and finance,and enhancing the corporate reputation.However,due to the new financing model of reverse factoring asset securitization is not pefect in terms of law and operation,there are problems such as over-reliance on core coporate credit,poor quality of underlying assets and ineffective design of transaction structure,which lead to certain risks in its implementation process.Finally,it puts forward suggestions for risk prevention such as introducing blockchain technology,setting strict screening standards for underlying assets,optimizing transaction structure,and improving relevant laws and regulations.Through the study of the case of reverse factoring asset securitization of Greentown Group,this paper believes that reverse factoring asset securitization is a valuable financing model in line with the current economic environment.And it can provide reference value for more real estate enterprises and enterprises in other industries.It is hoped that the research in this paper can play a positive role in promoting the healthy development of reverse factoring asset securitization in the future and expanding it to more industries.