On July 15, 2015, with Bank of Ningbo Co., Ltd as the sponsor and loan service agency, Anhui Guoyuan Trust Co., Ltd as the issuer, Industrial Bank Co., Ltd as the fund trusteeship agency, Citi Orient Securities Co., Ltd as the financial advisor and principal underwriter, and Dacheng as the special legal counsel, the first Dynamic Pool ABS Product of Inter-bank Bond Market - “Yongying 2015 Phase I Consumer Credit Asset Backed Securities” was successfully issued at a scale of over RMB 3.699 billion.

Dacheng’s Ningbo-based senior partner Attorney Wei Jie and Beijing-based senior counsel Mr. Wang Lihong and his asset securitization business team provided thorough legal services for the project. Team members include He Yuhua, Lv Xiaxi, Luo Jin, Zhang Jinjie, Xu Yuxiu, etc. The successful issuance of this project indicates that the dynamic asset pool model used for most offshore asset securitization products has been gradually recognized and accepted by domestic market.

The project is the first backed securities with personal consumption credit as the basic asset in the inter-bank bond market, since year 2012 when the securitization pilot was restarted. It also for the first time adopts the circular purchase dynamic asset pool model, actualizing a qualitative leap in innovation regarding trading structure of asset securitization from static pool to dynamic pool while enriching the basic assets for asset securitization products. The so-called static pool refers to basic asset pool determined from the very first counting date to be formed by pooled assets, which should remain unchanged. The dynamic pool uses continuous purchase structure, with the basic asset pool in change. With respect to the project, since the pooled loans are circular consumption loans, the repayment of borrowers is not fixed. With the dynamic pool model for circular purchase of qualified loans and the design of supporting cash flow payment mechanism, problems such as distribution of future cash flow can be resolved which are difficult for conventional static pool model to control or predict. Additionally, the asset pool model with circular purchase can control the deadline of the securities by setting properly the circular period and installment period, so that transactions can be arranged more flexibly according to the interest rate when the securities are issued.