Study On The Risks And Countermeasures Of The Local Government Financing Platform

Thanks to local government financing platform,the problem in lack of local basic construction financing was solved, so does the local basic construction itself,has been greatly promoted.In response to the financial tsunami in2009, the government published policy to encourage local formation of investment and financing platform, as a result, thousands of platform companies arise quickly, accompanied by the high loan balance and high debt rate, risk would be triggered at any moment, caused multitudinous social attention. From the beginning of2010, the government issued a series of policies and regulations require local government to neaten financing platform, and controlling the platform company’s loan increment and strengthen risk prevention strictly. Then monetary policies were continuous issued, make the companies difficulty in financing. What risk does local government financing platform has? How to solve these risks? This paper through the detailed anatomy of the DSC companies trying to find an answer.Firstly this article recommends the concept of local government financing platform and related knowledge, including the cause of the development process. On the basis of this, analyzes the necessity of local government financing platform. Then a detailed presentation of the paper focuses on the analysis of some cases of DSC Company. In a word, answered the question of " what is local government financing platform " and" why it should be continue and exist"Secondly, using the master DSC’s massive materials and data company risks are analyzed in detail, including the DSC company faced macroeconomic political risk, the registered capital risk, financial risk. internal control risk. Reveals the causes and consequences possibly be.Through the comparative study of domestic financing platform such as the Shanghai model to represent the company has done for a long time, and Chongqing representative of the pattern is Fu Asset Management Company Limited, Beijing model to represent the company in Beijing is the state-owned capital management center and the overseas outstanding enterprise Temasek Company’s advanced management experience and practice, to find their own inadequacies.Finally this article suggests the ways to resolve risk measures, such as positioning the company clearly; from the corporate governance structure, organization structure, human resource management, industrial structure and financial management and audit of all-round improvement and perfection of corporate governance; through the issuance of shares, bonds, and other means of introducing folk and foreign capital widening financing channels; through the development of MTR property and land replacement project to upgrade the company own hematopoietic function; for the whole project to carry out a full range of monitoring and other measures to dissolve the company risks, reduce losses to a minimum. These measures will be positive significance to other platform company to resolve the risk.