Generally speaking, banks will recover loans within the specified time limit after lending. However, due to the different actual operating conditions and credit status of borrowers and enterprises, or affected by the overall economic environment, some people cannot repay on time or lose their repayment ability. Therefore, the bank's credit at this time is divided into normal category, concern category, secondary category, suspicious category and loss category; The latter four can all be called non-performing loans and become non-performing assets on the bank's balance sheet, which banks need to deal with. In the past, it was divested to the four major asset management companies, but this uneconomical practice will not always be adopted. So there is the securitization of non-performing assets. Then predict how much these non-performing loans can be recovered and how long the cycle is, then price these non-performing assets and package them into securities, and then these securities will have prices. Because non-performing assets can also generate cash flow, similar to corporate bonds, they can be repaid as long as there is cash flow, so investors, that is, buyers, can be found in the end. As long as there is a suitable interest rate, this thing is still very easy to sell. At the same time, it also solves the problem that non-performing assets occupy the balance sheet for a long time, resulting in insufficient capital adequacy ratio.