The Study On The Risk In The Local Government Financing Platform Loan And Its Innuencing Factors

China’s urbanization continues to advance and requires infrastructure construction to keep up with the pace of economic development.Local officials need to stimulate growth of local GDP through government investment in infrastructure,so the desire of the local government to investment is strengthened.The current national financial institution expands the funding gap in local government,and the local government had to get the loan through the establishment of the local government financing platform.The competition in the commercial banks and the government background of the local government financing platform loan attract the lending of the commercial banks.The commercial banks compete to loan to the local government financing platform.The rapid development of the local government financing platform loan,especially4trillion investment stimulus in2008,makes the local government financing platform loan of the commercial banks surge.The loan promotes the local economic development,and optimize the structure of commercial bank loan.However,the local government financing platform loan are guaranteed in the financial or land revenue of the government.The fund mainly invests in urban infrastructure construction,and there is no direct economic benefit or only a low income,so the risk of future loan repayment is high.It is critical to establish the mechanism for risk prevention and repaying debt to the local government financing platform loan.It is necessary to research the risk of the local government financing platform loan from its source,the risk characteristics,the reasons for the risk and the influencing factors.And based on the empirical analyses in the risk and the influencing factors of the local government financing platform loan,the management countermeasures of risk in the local government financing platform loan are gotten to provide a reference for risk prevention of the commercial banks.The tax distribution system,Wagner’s Law,the urbanization and the performance appraisal system of the local government officials together promote the generation of the local government financing platform.The local governments and the commercial banks generate the local government financing platform loan based on the Game results of their own interests to maximize.The risk characteristics of the local government financing platform loan are mainly the legal and compliance risk,the moral risk in the governments,the policy risk,the liquidity risk,the credit concentration risk and the structural risk.The main risk cause of the local government financing platform loan comes from the information asymmetry and the problems in the government,the banks and the platform.The risk measure of the local government financing platform loan should be considered from the government,the platform and the project.There are many data associated with the risk of the financing platform loan,and it is more convenient to our study using the method of the principal component analysis to get the less and the most representative variable data from these data.The Logistic model have the less distribution demand to the data,so the relevant variables of the financing platform loan are suitable for Logistic Regression.The empirical result show that the governments,the platform companies and the projects are significant influencing factors,affecting the repay of the loan.The prevention of the risk of the financing platform loan can not simply start from a one-sided direction,but the supervision departments,the banks,the local governments and the platform companies work together to make the financing platform loan continue to play an important role to improve the livelihood and promote economic construction in China.