| Corporations continuously needs to collect capital to meet the demand of finance during the process of establishment and development, which requires to open a variety of capital collection channels. It has been demonstrated that by developing corporation bonds market and descending the percentage of financial assets of banks to GDP it could enhance the capability of the entire society to resist the financial risks. As to the corporation, that could descend the corporation's capital costs and promote corporation harness.Nowadays, the society's savings have exceeded 8 thousand billion Yuan and the percentage of the financial assets of banks to GDP has reached a risky point, further more, the assets of banks mostly turned out to be loans to the corporation which lacks of liquidity. To develop corporation bonds market is eagerly needed to solve these problem. Since 1992 the stock market has walked long before bond market. The listed corporation collected more than 90 billion in 2000 and 2001 in Shanghai and Shenzhen Exchange. However, corporations collected only 8.3 billion in 2000 and 22.2 billion in 2001 in the bond market. In order to enhance the security of financial system and promote the activity of corporation, we should develop bond market with great efforts.It has reached totally agreement between authors and officials on the necessity to develop bond market. However, their views scattered in a variety of papers and magazines, and mostly eyes on a special aspect, lacking of a systematic study of the entire market. It's a systematic project to develop the bond market that need consider all kinds of problem during the process of development. So to study the bond market from extensive aspects means we need start from the basic theory to mechanism and find out the ways to solve the problem at last. All thesehelp to better our capital market and can keep the macroeconomics stable and promote activeness of microeconomic bodies.This thesis was constructed as follows: Firstly, overviewed the function of debt and the impact of corporation's debt structure on the entire macroeconomics stability and microeconomic bodies' activeness. The financing institution of Chinese corporation was also studied in this part. Secondly, described the matured bond market's running mechanism and immediately turned to the Chinese bond market and discussed some factors which obstacle it's development. Finally, some suggestions was promoted to develop Chinese bond market.In the first part of this paper MM theory was introduced and discussed the basic function of debt in corporation finance: to improve the corporation's market value. MM theory was the basic content of the theory of corporation's capital structure and also consisting the theoretic foundation of bond market. Secondly, the issue of debt structure of corporation was discussed and the corporation's debt was divided into loans and corporation bonds. Compared with loans, corporation bonds have a function of diversifying risks and this helps maintain the stability of the macroeconomics; as to the microeconomic bodies, corporation bonds can descend the capital costs and urge corporations to keep a good credit record, it also helps to enhance the corporation harness because of hard budget. Except that, this part also overviewed the financing institution of Chinese corporation and concluded that it's hard to avoid financial risks if banks dominate the financing channel.The second part mainly concentrated on the economic bodies who take part in the bond market and debt redraw mechanism. If the lender and investor counteract directly, some problems such as information asymmetry arise. Thus government and intermediaries became necessary to help the twos finish the trade. In this part also studied the debt redraw mechanism which ensure the investors' interests.In part three some factors which obstacle Chinese bond market's development was discussed. Generally speaking, government regulation was the most important reason which makes bond market inactiv... |
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