The Evaluation On Corporate Bond Financing Efficiency

In 2007, "The Pilot Rules on the Issuance of Corporate Bonds" was promulgated. The corporate bond market has been developing quickly, which provides Chinese companies a new channel for the choice of financing. However, whether the company that issues the corporate bond has rationally use the money raised and whether the company reached the optimal scale of production has caused the concern and the thinking of the social public. Corporate bond financing efficiency can be used to explain the problem related to the above mentioned. However, the research about corporate bond financing efficiency is very rare for the moment, so this paper has the scientific and realistic significance.This paper finds that using factor analysis and data envelopment analysis to evaluate corporate bond financing efficiency is feasible after studying the domestic and foreign research on financing efficiency and evaluation method. This paper establishes a unique efficiency evaluation index system of corporate bond financing and use factor analysis to reduce the dimensionality of the 14 indicators and extract four main factors which will be used as input and output indicators in data envelopment analysis. This paper use the data envelopment analysis to evaluate corporate bond financing efficiency by studying the 111 listed companies which have issued the corporate bond by the day of December 31,2011. This paper uses DEAP 2.1 to get the technical efficiency, pure technical efficiency and scale efficiency of each listed companies and make the comparative analysis according to industry and region. Finally, it came to the conclusion that corporate bond financing efficiency in China is pretty low and accordingly this paper makes some suggestions to corporates and regulators.