Study On The Function And Development Of China Finance Company Of Enterprise Group

Among China’s financial system, finance companies of enterprise group are aspecial category of non-bank financial institutions. This kind financial system is also aspecial arrangement. It is an important supporting measure for our country to promotethe reform and development of the large-scale state-owned enterprise group, but alsothe products of conglomerates promoting mutual integration of industrial capital andfinancial capital. For a long time, there is a lot of controversy for the necessity of itsexistence among the domestic regulatory authorities, financial institutions andenterprises within the group, especially in large enterprise groups who pursued bycommercial banks for providing them financial services. The finance company of theenterprise group in our country not only did not shrink, but also the number hasincreased, even more the quantity and quality have been improved. Research for thecapabilities and development of financial companies are helpful for reach a morescientific explanation of these issues.The paper reviews the six theoretical basis of the finance companies existence. Italso analyze the operation mechanism through three aspects, from the role of financecompanies within the group, analysis the role of financial companies in the promotionof industrial capital and financial capital combination. It summarized the functionaladvantages of the financial companies in China. Meanwhile in the context of thedevelopment status analysis of the finance company sector, we take the only localfinance company in Nonferrous Metal Industry for example, Jiangxi Copper GroupFinance Co., Ltd.. This paper analysis the statistical indicators from the microscopicpoint of view by using financial analysis methods, combined with SWOT analysisclarifies the problem through the developing of financial companies. This paper tryingto put forward good suggestions for these developing problems, which can lead anmore healthy development of the financial companies. These suggestions also canprovide a more powerful theoretical support for the enterprise groups to keepdeveloping and growing.