ABS financial products refer to securitized assets, and ABS is asset securitization. Asset securitization refers to a financing method that guarantees the expected income that the project assets can bring and then sells it to the capital market for financing. Asset securitization can improve the financing efficiency in the economy, but if it is not regulated and allowed to expand, it will bring great risks.

Pattern characteristics

(1) The biggest advantage of ABS financing mode is to raise funds by issuing bonds in the international market, and the bond interest rate is generally low, which reduces the financing cost.

(2) Raising funds by issuing bonds in the securities market is a remarkable feature that ABS is different from other project financing methods.

(3)ABS financing mode isolates the original project owner's own risks, so that the funds to repay the bond principal and interest are only related to the future cash income of the project assets. In addition, bonds issued in the international market are bought by many investors, thus dispersing investment risks.

Extended data

With the development of international economic cooperation, asset securitization financing has attracted more and more attention from financiers and investors. All infrastructure and public works development projects with foreseeable future income and continuous cash flow can be financed through ABS financing.

Many countries and regions focus on ABS financing of railway, highway, port, airport, bridge and tunnel construction projects in the transportation field; Power, gas and natural gas infrastructure construction projects in the energy field; Health care in the public sector. Good results have been achieved in the construction of public facilities such as water supply, power supply and telecommunication network.

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