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Transformation of asset management companies in China to the Deposit Insurance Corporation

Author: ZhuHaiFeng From: www.yourpaper.net Posted: 2009-04-02 15:38:17 Read:
Abstract: The transformation of China's four asset management companies in the sector of non-performing assets has not been clear if the four asset management companies asset disposal sector restructuring Deposit Insurance Corporation into the future, not only can achieve economies of scale, saving social resources , but also improve the efficiency of the disposal of non-performing assets, the disposal of non-performing assets to maintain a lower cost, better solve the asset management company legacy of commercial transformation.

Keywords: asset management company; Deposit Insurance Corporation; transformation

2007 third national financial work conference, to accelerate the transformation of the financial asset management companies, China's four asset management companies have accelerated the pace of business transformation, relying on the securities, trust, fund, leasing and other financial services platform for development, but its large-scale disposal of non-performing assets sector restructuring has not been clear, and with the issue of asset management companies speed the commercialization of transformation began to stand out. What is the dissolution of the revocation of these institutions, or let commercial banks incorporated in the original counterparts, different opinions.
In the long term, China's economic development will be the impact of the economic cycle, a large number of new non-performing assets will generate, so reserved and professional asset disposal sector adapt to the needs of the economy. If the transformation of the four asset management companies the disposal of non-performing assets management department reorganized into the deposit insurance system which can meet the increase of non-performing assets the progress of the need to improve the recovery efficiency of the insurance fund, and not leave existing social resources are wasted.

First, the possibility of asset management companies incorporated into the Deposit Insurance Corporation

(A) has a large number of professional and technical personnel and rich asset management, disposal of experience
China's four asset management companies asset disposal including lawyers, certified public accountants, asset, including a large number of professional and technical personnel, senior professional and technical personnel account for more than 10% of the total number of employees is very rich in human resources reserve. The end of 2006, four asset management companies total non-performing assets disposal policy of 1.210282 trillion yuan, the cumulative recovery of 211 billion yuan in cash, in addition to the four asset management companies also undertake part of the value of non-performing loans of commercial recycling business and achieved good The results of the staff of the four asset management companies in the asset disposal process has accumulated a wealth of experience, can play an important role is responsible for the liquidation of assets, disposal functions. And the above Professionals precisely the future establishment of essential Deposit Insurance Corporation, the Deposit Insurance Corporation can absorb the staff came in to conduct their own business more smoothly.
(B) has a large number of asset disposal, sales channels and branches
China's four asset management companies in the asset disposal process are widely established branches, asset management companies across the country have the 20-30 home offices located in China's major provinces and territories. Decade-asset disposal process, asset management companies around the auction houses, private asset management companies, foreign investment banks and other institutions processing a large number of non-performing assets, in order to accelerate the speed of the disposal of assets provides a good exploration. The future of the Deposit Insurance Corporation established, should learn from this experience, to strengthen cooperation with external specialized agencies, improve the efficiency of asset disposal.
(C) absorption, learning to more advanced asset disposal experience and technical
China's asset management companies through cooperation with internationally renowned asset management companies, investment banks and other professional bodies, using a variety of innovative means to dispose of non-performing assets, has a wealth of experience and successful practice. For example, in March 2002, Huarong Asset Management Corporation and Morgan Stanley jointly formed the first joint asset management company, responsible for the disposal of finished Huarong sold as a package worth 108 billion package of four assets in the seven-year life of the operation. Cooperation with these international professional organizations, China's asset management companies to improve the speed of disposal of assets, and learned a state-of-the-art asset disposal technology, and achieved good results in asset recovery, asset disposal rate and other indicators.

Second, China's asset management companies incorporated into the Deposit Insurance Corporation inevitability

(A) stable sources of funding and abundant, can effectively improve the efficiency of asset disposal
Foreign Deposit Insurance Corporation, the asset management company's asset disposal Experience has shown that, in order to maintain the speed of the disposal of assets, there must be a strong source of funding do support. If the lack of sufficient funds, asset managers will make asset management institutions to extend the takeover period of non-performing assets, so take over the increase in operating costs. China's asset management companies set up facing a shortage of funds for the disposal of assets, the central bank had to issue huge financial bonds, the debt service pressure is a serious threat to the normal operation of the asset management company, making asset disposal costs much higher than those in other countries.
There are also paid in the process of the operation and management of personnel costs, management fees and operating expenses, are required by the disposal of assets recovered cash flow digestion. Incorporated into the deposit insurance agency, you can raise premiums to solve the problem of inadequate insurance fund source, stable financial support, and can be charged the difference between the premium way to control the risk of insured financial institutions to improve insurance asset quality, reduce the cost of the disposal of assets to improve the operating efficiency of insurance funds.
(B) as a creditor of the assets can exercise a variety of means of disposal, reduce the cost of disposal of assets
Asset management companies and the Deposit Insurance Corporation by the two institutions in the surviving period, the disposal of assets used by the functions of positioning different, the two institutions are not the same. The asset management company in order to address the financial crisis or financial reform, the urgency to make it in time when the disposition of assets more emphasis on the disposal of assets speed and less attention to the reorganization of assets, so that it was forced to give up some may reduce the cost of disposal of assets, restructuring and the transfer of assets, which increased the cost of the disposal of assets in the intangibles. Deposit Insurance Corporation has sufficient time to assess the situation of non-performing assets and determine the most appropriate manner of disposal of asset restructuring means.
Can learn from the successful experience of the United States and other countries, so that the advantages of the combination of both Asset Management Corporation and the deposit insurance system incorporated into the deposit insurance agencies can act as a "bypass" the role of the bank, such as financial asset management companies, namely the establishment of a new financial institutions, to buy and to undertake operations fall into difficulties of the bank's assets and liabilities, or through the purchase of its common shares and subscription of its preference shares, the implementation of the capital increase of financial institutions, as much as possible to reduce the impact of the financial crisis. In addition, the asset management company, incorporated into the Deposit Insurance Corporation, also can take advantage of plenty of time to take over non-performing assets reorganization of assets, to find a good husband through the integration of resources, packaged for sale in the hands of non-performing assets, improve cash collection rate. (C) to completely resolve the existing corporate governance mechanism is unknown, the state injected into the ownership of the capital, debt obligations and other issues
The beginning of the establishment of the four asset management companies, the Ministry of Finance to each asset management companies inject 10 billion yuan, and its burden on wages and salaries. In addition, in order to solve the lack of disposal of funds, the People's Bank of China to the four asset management companies to provide 570 billion yuan of loans, four asset management companies to the commercial banks and the State Development Bank issued a total of 820 billion yuan of financial bonds. Debt obligations of the policy is not clear, in the final disposal of the huge amount of re-lending and financial bonds is clear,
Four financial asset management companies is difficult to conduct a thorough business transformation. If all four asset management companies into commercial operation, the equivalent of the country's financial capital in the non-public welfare from operating activities, and national economic reform ideas that the state-owned capital should withdraw as far as possible from the field of competition, to encourage the development of private capital contrary.
If the part of the four asset management companies to restructure, into the future establishment of the Deposit Insurance Corporation, the above problems can be a better solution. Due to disposal costs owing to the original policy of non-performing loans and other historical re-lending and financial bonds into the Deposit Insurance Corporation, by financial provision write-off year by year; disposal of commercial non-performing loans due to the cost of deposit insurance premiums to offset. Part of the capital injection by the state allocated to the Deposit Insurance Corporation, to assume the financial risks stability of the financial functions of the order for the community to provide the necessary public goods, to avoid "the public for profit".
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