Author(s)

Peihong Xu ¹

Affiliation(s)

¹ School of Economics and Management, Guangxi Normal University, Guilin, Guangxi, 541000, China

Corresponding Author

Peihong Xu

ABSTRACT

The Chinese automotive industry has witnessed a new era of prosperity with the advent of the new energy automobile industry. The growth of automotive finance companies is inextricably linked to the fortunes of automotive companies, and it is of paramount importance for the development of automotive enterprises to diversify their sales channels and realise cash flow recovery through automotive finance companies. The development of auto loan asset securitisation not only recovers the cash flow of issued loans in advance for auto finance companies, but also effectively reduces their default risk. This, in turn, further promotes the business growth of auto finance companies and the expansion of the scale of auto enterprises. This paper provides a brief overview of the process of auto loan asset securitisation in China, highlighting the current challenges faced by auto finance companies in this area. These include low levels of asset securitisation, the lack of true sale in auto credit asset securitisation products, and the instability of underlying asset pools. The paper also suggests potential solutions to address these issues.

KEYWORDS

Auto finance, Securitisation of assets, New energy vehicles

CITE THIS PAPER

Peihong Xu, Application and Development of Asset Securitization in China Auto Finance Corporation. Financial Engineering and Risk Management (2024) Vol. 7: 192-199. DOI: http://dx.doi.org/10.23977/ferm.2024.070325.

REFERENCES

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[3] Zhang Yibin,Zhang Huaxi. Green Asset Securitisation in China: Opportunities, Challenges and Suggestions for Countermeasures[J]. Tsinghua Financial Review,2023(12):88-90.
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