Since the opening of Honesta Capital salon— “Brown bag lecture series”, the salon has brought a lot of exciting content. On January 29, 2018, we invited Dr. Chen Lei, a domestic ABS expert, to bring a wonderful second lecture, "ABS Thematic Share".
Dr. Chen Lei has worked in investment banking, asset securitization, non-standard product design and debt capital markets in the United States and Greater China since 1994. He is currently the vice chairman of XFinTech (shareholders including WeBank and Xiamen Jinyuan Investment Group Co.,Ltd.). He served as the managing director of Barclays Bank (Hong Kong) and served as the vice chairman of New China Trust Co.,Ltd. Previously, he held senior management positions at Citibank, Royal Bank of Scotland and CICC, and served as CEO of Shenzhen Shenghai Investment Management Co.,Ltd. in Hong Kong after the 2008 financial crisis. He holds the license for the responsible/supervisor of the Hong Kong Securities Regulatory Commission's Class 1, 4, 6, and 9 businesses.
Chen Lei led the Royal Bank of Scotland's strategic investment in Suzhou Trust. He was one of the project leaders to complete the planning and distribution of the following projects, the first real estate investment trust (Yuexiu REIT) issued overseas in China, and commercial property mortgage asset securities (Wanda CMBS). He also provides consulting services for private equity and debt financing for several domestic banks, corporations, and real estate projects.
Mr. Chen returned to China in early 2003, before he worked in the US financial and scientific community for 17 years. He graduated from the University of Science and Technology of China in 1982, and a Ph.D. in the University of California, Berkeley in 1994.
△ Dr. Chen Lei academic participants to share
Chen Lei returned from Wall Street a few years ago. He served as the vice chairman of Xinhua Trust, the managing director of Barclays Bank, the managing director of Royal Bank of Scotland, the first executive general manager of CICC's asset management department, and Citigroup, RBS Securities, Wachovia and other Wall Street investment bank executives. He has a deeper understanding of asset securitization.
Chen Lei said that in the past two years, the ABS market has grown from zero to nearly one trillion in circulation.It seems that the amount is already very large, but this one trillion is just a fraction of the market for securitization of our assets in the next few years. At present, the domestic securitization bond market can be divided into the inter-bank market (the so-called first debt board), the Shanghai Stock Exchange/SZSE (second debt board), and all other OTC credit markets (third debt board). The scenarios, characteristics and regulatory systems of these markets are different. Among them, the third debt board market needs to be boosted by financial technology.
For the industry pain points of the current securitization market, Chen Lei said that, this year the industry leaps soared, but the market is still very small data, participating agencies, low efficiency issue, this is the first pain point. Second, until now, no credit risk market, high cost, market fragmentation, the lack of uniform rules and standards. Third, development is limited, and small and medium-sized institutions generally lack tools and means for quantitative analysis. Fourth, the lack of professional institutional investors, secondary market liquidity is very poor.
These four pain points hampered the securitized assets into a real important market. How to make our market go from one trillion to 100 trillion, we must first solve these pain points.
Asset securitization is a long-term project, a social project, an interaction of a many-to-many financial institution, from the evaluation of investors, accounting, lawyers, etc., is a network of exchanges. Using the cloud platform of the Internet, we can turn this into a one-to-many and more effective platform for work. "We can be like the US market, as slowly growing, slowly accumulated, we can also make use of existing financial technology, the Internet and other overtaking around the curve, the market went from one trillion one hundred trillion."
△ Dr. Chen Lei (fourth from right) with participants photo