As the scale of asset management continues to be compressed, the asset securitization (ABS) business has surged against the trend, and the current issuance scale has exceeded the 3 trillion mark. For a long time, the battle between institutions has filled the ABS business battlefield with smoke. However, among them, some professional companies with resources and other advantages have gradually grown and stood out.
Recently, Xu Gang, head of the ABS business of Guotai Junan Securities Asset Management Co., Ltd., said that for leading securities firms, "prudent" and "cautious" are the keys to survival, and they must combine system awareness and matching comprehensive strength. In combination, we focus on quality with one hand and capture innovation with the other.
In the interview, Xu Gang preferred to call himself a value undertaker in the asset securitization business. "ABS, as a bridge between the real economy and the capital market, is an advanced tool that can create value. We hope to create sustainable value for enterprises and society through asset securitization."
As of 2019 By the end of September 2020, the scale of asset securitization products registered by Guojun Asset Management reached more than 120 billion yuan, ranking second among securities firms’ asset management subsidiaries. With its outstanding performance in professionalism, innovation, scale and robustness, Guojun Asset Management won the "China's Best ABS Broker Asset Management Award" at the China Securities Dealer Asset Management Yinghua Award from 2018 to 2019.
Systematic and puzzle-like development
Data recently released by the China Foundation Association shows that as of the end of the first half of this year, a total of 132 institutions have registered and confirmed 2,244 asset-backed projects. plan, with a total registered scale of 3.039126 billion yuan.
With a scale of over 3 trillion, it is obvious that compared with the previous two years, the ABS business has already left the preliminary stage and has a certain development foundation. However, with the strong support and encouragement of the regulatory authorities, It is still a market with huge potential that needs to be explored, and therefore it has attracted a large number of institutions to compete. Especially for securities companies, the ABS business is a new growth point in the future. Each company is increasing investment. How to create highlights and features requires not only the systematic resources provided by the platform, but also the internal strength of the business team itself. It's a huge test.
In 2012, Guojun Asset Management, then 2 years old, established a structured finance department. Xu Gang was the first employee of this department, filling a gap in the financing business of Guojun Asset Management. In 2014, the asset securitization business developed rapidly after switching from an approval system to a filing system. Faced with the growing size, Guojun Asset Management established an independent asset securitization department. So far, although the company's ABS team has a small number of people compared to its peers, its per capita profit has always ranked first in the industry. Xu Gang said that the sound systematic platform of Guotai Junan Securities has connected the asset securitization sector with other sectors within the group, forming a strong combat effectiveness. Everyone has strong collaborative capabilities between teams, within the asset management company, and between the group’s business lines. Therefore, both in terms of business acquisition capabilities and fund sales capabilities, it provides good support and provides a good foundation for the development of Guojun Asset Management's ABS business.
"Every major securities firm has a strong branch system, but the organizational and mining capabilities of each firm are different, or they are vastly different," Xu Gang said, for example, who often We will provide training and business sorting for branches of Guotai Junan. Although these targeted communications will not produce benefits within one or two years, they are very important for the development of the business in the future. "For example, for the delivery of projects, Guotai Junan is currently very systematic, ensuring the source of projects." In his view, for large securities firms, the integration and mobilization of the system can be productive.
On the other hand, the current competitive landscape of asset securitization is very fierce. Although it is easy to enjoy the shade with a big tree at its back, its own independence is the basis for ensuring that it leads the industry and is irreplaceable. Xu Gang calls it "internal strength", and his department has also done a lot of exploration for this. "We need to make features in the business chain, including growth results and innovation. We need to have the concept of jigsaw puzzles, and make up for which pieces are weak. "In his view, some efforts may not produce results that year, but they must be done. They must have a systematic awareness and a matching sector-specific operation strength. The two complement each other.
The strategic layout pursues comprehensiveness
In terms of strategic layout, with the same positioning as Guotai Junan's comprehensive securities firm, Guojun Asset Management's ABS business takes a comprehensive route.
"As a large institution, we will inevitably choose a comprehensive route. We have a voice in every field, and we will do it in all major categories of basic assets. But the comprehensive route will still be more refined. , strategically choose some sustainable categories." He gave an example. For example, there are many categories of commercial real estate, but the input-output ratio of many categories will be relatively small, so we will choose those sustainable categories. There is also financial leasing, which basically chooses some leading institutions with very strong renewable capabilities.
At present, Guojun Asset Management’s ABS business mainly focuses on several aspects. First, the relatively traditional lines, such as leasing, which are battlegrounds for leading institutions every year; in addition, supply chain, accounts receivable As an area where ABS really plays a role, finance is also an important sector; at the same time, in the real estate field, CMBS will be a more important focus this year.
"Prudent + Steady"
In the process of developing the ABS business of Guojun Asset Management, "prudent" has become the consistent style. This robustness is reflected in the prudence with which projects are executed.
This is the case in the field of consumer finance. In 2017, consumer finance became the basic asset class with the highest proportion in the field of asset securitization. With the help of consumer finance ABS, some securities companies have quickly expanded to a large scale. But even so, Xu Gang remained cautious.
"This kind of caution is based more on some objective circumstances. It is difficult to say whether it is reasonable. But at that time, we regarded consumer finance as a business form that increases leverage for individuals, and Guojun Asset Management was developing assets In the securitization business, the 'color' of serving real enterprises and supporting the development of a strong economy should be stronger," Xu Gang said frankly.
However, this year, Guojun Asset Management will make some attempts around leading institutions in the field of consumer finance. The reasons for this, in Xu Gang's view, are mainly due to several points. First, the gradual growth of consumer finance has brought about a clearer market structure; in addition, the technology of some leading institutions is also rising. After several years of data accumulation, the company itself can Identify possible risks based on risk management technology and capabilities; more importantly, the Guojun Asset Management ABS team, as well as the entire market, have gradually improved their understanding of data in the field of consumer finance, and their knowledge reserves are sufficient to control This is an area that was previously “clearly unclear and not yet stable.”
"Just right" risk control
Monarch Asset Management has a set of "tailor-made" standards for risk control. In Xu Gang's view, the best way to control risks is "just right." The "one size fits all" approach is not only unscientific, but also causes the company to lose many business opportunities and many team talents, but it must not be too loose. The pursuit of quality cannot be lost. To achieve this, precise control of risk control is required, which is a relatively difficult risk control technology.
"Just right" risk control can focus on quality with one hand and highlights with the other.
The ABS team of Guojun Asset Management was previously exposed to a real estate project. The rating of the other company was not very high, but the property was mature and located in a first-tier city. The standards of this project fluctuate around what Xu Gang calls “just right”.
"Generally, we are often cautious when dealing with companies with this type of qualifications. However, through an in-depth analysis of this company at that time, we found that they are very focused on their main business and have strict control over business risks. He is also very focused on the formulation and implementation of development strategies. After interacting with the professional managers of the company, I found that they are also very frank and stable. At the same time, they have strong research on the industry and are very accurate and professional." Xu Gang said frankly that there was an internal debate within the team at that time. It took a long time, but I finally decided to do this project, and now the effect is very good. It has been very stable in the context of the economic downturn in the past two years.
The pursuit of quality and the exploration of highlights allow Xu Gang’s team to grow healthily and steadily amidst challenges one after another. At the same time, in the past few years, the entire industry was in an emerging stage, and everyone was racing to gain land and pursue "food and clothing". But now that it has developed to a certain extent, there is space and business support to think about the future.
Speaking of future vision, Xu Gang said that in the medium to long term, he wants to become a first-class team in the securitization field. In his view, this first-class team refers not only to market share, but also to the team’s choice space. "The stronger the ability, the greater the space. This space does not refer to income space, but decision-making power and freedom. This is a virtuous circle."
This article is from China Fund News
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