Analyses on benefits and risks of mortgage-backed securitization in China

Mortgage-backed securitization (MBS), as one of the most important financial innovations, serves not only to reduce the risks in real estate market, but also to vitalize the capital market. After presenting the financing situation in Chinese real estate market and the feasibility and imminence of MBS in Chinese market, the authors analyze the benefits to macroeconomics and each party participating in the securitization. Financial risks that are involved are also emphasized. In the end, the authors put forward some perspectives towards risk avoidance and decision-making.