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The Legitimacy Analysis Of The Non-financial Corporation’s Financial Behavior And The Way To Cope With It

Posted on:2014-04-10Degree:MasterType:Thesis
Country:ChinaCandidate:D H LiFull Text:PDF
Abstract/Summary:PDF Full Text Request
In recent years, private lending developed rapidly in our country. Largenumbers of organizations, named as investment company, consulting firms, engagedin private lending all over the country. Because of the huge demand in the privatefinancing market, private finance changed from hidden lending between individualsto semi-public operation of company. The previous research always analyzes theprivate lending activities from a macro perspective holistically. They generally startwith the reasonableness and necessity of private lending, introduce some existingforms, analyze its problems, and finally make recommendations. However, as toInvestment companies which are engaged in private lending are widely existed inexercise, its legitimacy has not been studied and discussed directly and deeply. Thisarticle focuses on only one form of private lending, taking Huijin InvestmentConsulting Company as an example, studies the private lending activities ofnon-financial corporations from a micro perspective and makes legal interpretationfor such activities. This article tries to make the legal status of non-financialenterprises engaged in lending clear and definite. And under the circumstance thatprivate lending develops so dramatically that it may cause wide scale financial risk,this article proposes government should legislate to guarantee the lenders’ lending right, and to promote the free competition in lending market. On the other hand,government also should put appropriate supervise on lenders, regulate theirmanagement behavior, and reduce the financial risk.The article is divided into three chapters. The first chapter briefly introducesHuijin’s operation from four aspects, the source of capital, the way of lending, riskcontrolling and the way to realize the obligatory rights. The second chapter is thecore of the article. It analyzes the legitimacy of Huijin’s operation from perspectivesof Financial Regulation Law, Business Organization Law and Contract Law. Huijinoperates traditional financial business, essentially, it still belongs to traditionalfinance, and is different from modern bank. While the main purpose of the financialregulation is to solve the problem of information asymmetry. Huijin operatesbetween acquaintances, it doesn’t have such problem. So there’s no need tosupervise it as a modern financial enterprise, even though problems exist in itsoperation. The third chapter simply analyzes why private lending is so active andthen gives two recommendations. One of the recommendations is to launch the<lending Ordinance>, which recognizes the legitimacy of private lendingorganizations from the legal perspective. The other is to perfect registration systemof private lending, to make the private lending develop better.
Keywords/Search Tags:financial regulation, non-financial enterprises, private lending, financial reformation
PDF Full Text Request
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