Study of Taiwan's banks NPLs securitization

• Main Author: 廖榮隆
• Other Authors: 林基煌
• Format: Others
• Language: zh-TW
• Published: 2003
• Online Access: http://ndltd.ncl.edu.tw/handle/01123644104805333597

碩士 === 國立政治大學 === 經營管理碩士學程 === 91 === Securitization is one of the most import innovations in financial markets since the 1930s. Asset securitization began in the United States in 1970, residential mortgages were first packaged for the issuance of RMBS. In the mid-1980s, originators of credit cards, automobil loans, student loans and manufatured housing loans patterned after the RMBS market and pooled these new loans for the issuance of asset-backed securities(ABS). The MBSs/ABSs have come to a significant portion of fixed-income holdings for many types. The MBSs/ABSs family like CMOs, IOs, POs , PACs , TACs, CDOs, become a major component of the U.S. bond market already.In the first half of 2002, the MBSs/ABSs markets with an outstanding balance amounted to an estimated $8.1trillion, representeld the largest(42%) market share of the U.S.Bond market. Taiwan’s Financial Asset Securitization Law (FASL) was enacted and promulgated on July , 2002. With the recent passage of the FASL, Taiwan’s capital markets have entered a new era. The successful development of the securitization market can foster more balanced capitl markets that consist of both stocks and bonds. Taiwan so far has not created a securitization market, conditions are now ripe-some are even critical for the development of such a market. Conceptually, the purpose of financial asset securitization in general is to raise funds for the originator. I think originator is the most import participant on the securitization process. But Taiwan’s banks are now confronted with the increase in NPLs problems, it result their lending policy turned conservative, and led to a surplus of funds in the banking system. Under the abundant funds circumstance, there’re no strong enough “induce factor” let the “normal” assets to securitize. Most of them only hope FASL can help facilitate the liquidation of the underlying assets of NPLs. In recent years, as the world economic growth slowed, Taiwan economy turned sluggish too. Taiwan is now at the critical moment because of the greatly depressed real estate market and the abundant NPLs of the banking system. The depressed stocks and real estate properties, which were the collateral for various bank loans, sagged the quality of assets of the banking system. This thesis analyzes the reason why the NPL ratio steadily grow in Taiwan’s Banking system and discuss its’ influence to marcoeconomy. Taiwan’s banks have made a great endeavor to couple with the government’s “Financial Reform” policy, write-off NPLs aggressively since 2 years ago. I agree that securitization is the most efficient way to ease the NPLs problem in Taiwan. In chapter 5, I collected 4 transactions of securitization of NPLs for our reference. I hope we can learn something from those case studies, and find out the know-how to structure in the securitization of Taiwan’s NPLs. In briefly, I believe the securitization of NPLs will be workable in Taiwan somedays (maybe 1 year or more). I will study this issue more deeply and encourage the man who is interested in this issue, study it more deeply, follow the right direction above.