Risk Assessment Of Local Government Financing Platform

Government financing platforms are the main financing facilities of the local government, played a important role in the local economic development. In recent years, the increasing numbers and scale of government financing platforms lead the public concerns about their risk. In this paper, we study the risk of local government financing platform. This article began with introduction of the background, definition, classification, the operation mode and its role of the platform, and also analyzed the risk factor of platform. From researching on current situation and data, this paper does the practical study of the financing platform of local government in a sample province. After the general description of the situation and loan of platforms, the paper analyzed the risk of platform. Then, we choose 78 City Construction Bonds as sample (excluding those incomplete financial data), and use multi-category ordered logistic model to analysis the relationship between financial indicators and credit rating. After that, we established a model based on matter-element extension theory and use it to study 16 platforms of the sample province. In the last part of this paper, we give some suggestion on the operation of the government financing platform.