Research Of Debt Financing Cost For Chinese Listed Companies

Since the Reform and Opening, debt finance started to turn up in our enterprise.In2005CPPCC and NPC, premier Li proposes ideas to promote credit assetsecularization and enlarge the scale of company bond issuance. After30years, ourcompany debt finance had the huge progress. However, on the whole, our companydebt finance problems such as too low debt ratio, heavy trust on the credit of bank,large proportion of the business credit, low proportion of the debt finance and so onare serious.Academics and theorists study found that in addition to the factors that China’scapital market structure is irrational and government policy focus too much on stock,that company debt finance costs too much is the root of the problem of company debtfinance. Therefore, analyzing factors affecting the cost of the company debt finance isa theoretical set of practical significance.Based on the company’s debt finance combing the literature and analysis of theStatus of Listed Companies Debt finance.We get the following conclusions withrelated data of2008-2013A-share listed companies debt finance through empiricalanalysis.1.Overall, our debt finance’s level of listed companies is not high and the cost ofdebt finance is high. Other than company-specific factors, macro level nationalmonetary policy is reasonable or not, the overall level of economic development,development of capital markets have a significant effect on the cost of company’s debtfinance. Loose monetary policy, high level of economic development and goodefficient capital market provide protection for the company to reduce the cost of debtfinance.2.On the company’s own factors, in addition to size, solvency, profitability andother hard factors, the level of company governance determines the cost of companydebt finance. Good company governance can significantly reduce the risk ofinformation asymmetry between creditors of the debtor, reduce adverse selection costsfor creditors, which finally reduces the cost of company debt finance.4.On our unique regional finance environment, good finance environment ensurethe company a lower cost of debt finance. The better area of listed companies, themore finance channels, the larger the enterprise, the lower level of constraint, and the lower the cost of debt finance. And good finance environment will strengthen the roleof company governance to the efficiency of debt finance to reduce the problem offinance constraints by improving company governance.Finally, we propose to develop a reasonable monetary policy, speed up economicdevelopment, improve the development of capital markets, improve the companygovernance structure of listed companies, create a good finance environment on therelevant conclusions.