Study On The Relationship Between Listed Corporate Bond Financing And Corporate Performance

Money is like blood, enterprise development needs financial support. However, most companies rely on their own retained profits to obtain financial support, after all, it is limited, so enterprises want to develop, need to absorb the external funding. Meanwhile, people hold idle funds, also hope to be able to make more efficient use of funds. If these two needs could match each other, then it can reach a financing deal, the so-called direct financing. Stocks and bonds are the important channel of direct financing of the enterprise.According to the report of central Treasury securities registration and settlement companies, by the end of December 2013, the national debt market total amount trillion custody.Bond custody quantity increase tenfold, circulation increase sevenfold and the volume growth is about 17 times in nearly a decade years, The bond market has become China’s largest and most important capital markets. Super day debt defaults released on March 4,2014, as the first event of default on the bond market, it will have what kind of impact on the bond market and the performance of listed companies? Based on this background, this paper studies relationship of corporate bond financing and corporate performance of listed companies.This article is divided into six parts. The first part is the introduction, introduced this article research background, significance, research ideas and methods, the research content and framework, and possible innovations of this article.The second part reviews the domestic and foreign relevant research results of relationship between debt financing and corporate performance. Relationship for both domestic and foreign many scholars have their different points of view, mainly divides into three kinds:corporate debt financing and corporate performance have positive correlation; Corporate debt financing is negatively related to the corporate performance; Company without a stable relationship between debt financing and corporate performance.The third part introduces the relevant theoretical analysis and the definition of the concepts. First defined the meaning of corporate bonds, the advantages of bond financing and analyzed the bond financing present situation; Then define the definition of corporate performance, corporate performance evaluation methods both at home and abroad are reviewed, and the company performance metrics, analysis out in this paper, using principal component analysis (pea) to measure the comprehensive performance of computing company; Finally according to the theory of "MM" as the cut-off point, this paper has analyzed the modern capital structure theory. Because bond financing is part of the debt financing, therefore, using the capital structure theory as the foundation, analysis of the impact of debt financing on corporate performance including bond yields have tax shield effect, constraint incentive effect to the enterprise managers, reduce the cost of financing, release the company financially sound signal effect to outside investors to, etc.The fourth part includes the design of the sample selection and variable model. Firstly according to the theory of the third part of analysis, put forward two assumptions in this paper, Hypothesis 1:under the condition of the other factors unchanged, corporate bond financing were positively correlated with corporate performance; Hypothesis 2:level of debt financing of listed companies has inverted u-shaped relationship with corporate performance, i.e., when low proportion bond financing, corporate performance positively related to the bond financing; The higher percentage in bond financing, corporate performance is negatively related to the bond financing; Then, for the first time in 2011 to issue corporate bonds of 41 listed companies as research samples, collected every company after the issuance of the previous year, that year and two years of financial data for research. Chosen respectively on behalf of the company’s profitability, shareholder profitability, development ability, operation ability and solvency of ten index as an indicator reflects the comprehensive performance of the company; The final design in this paper, the various variables and the model showing the relationship between variables.The fifth part is the empirical analysis. In this paper, first of all, the principal component analysis method is used to calculate the listed company’s comprehensive performance in the issuance of the previous year, that year and later two years; Second analysis the change of the trend corporate performance in the issuance of the previous year, that year and later two years from the perspective of dynamic angle, and concluded that Chinese listed companies issuing bonds have low company’s comprehensive performance than that before the issuance. Then, making regression between corporate debt financing and corporate performance relationship from the static angle, the conclusion is negatively correlated with corporate debt financing and corporate performance relationship, refused hypothesisl;Conclusion by quadratic regression is rate of corporate bond financing is u-shaped relationship with corporate performance, in a certain range, the company performance decreased with the increase of debt financing; when surpassed this range, the company performance will increase with the increase of debt financing rate. Finally, from the two aspects of listed company’s share price changes and yield changes to analyze the super day debt defaults’impact on corporate performance, it is concluded that the incident has negative effects to the performance of listed companies.The sixth part is research conclusion. First, the paper analyzes the relationship between corporate debt financing and corporate performance, and analyzes the reason of the result, think that the current size of our country’s corporate bond market is still small, rate of corporate bond financing is insufficient, therefor weakens the positive effect of debt financing on corporate performance; Then respectively from the government supervision, listed companies and investors three aspects put forward the suggestions to improve the bond market in our country; Finally, because I am limited by the knowledge structure and ability, on the impact of debt financing of listed companies on corporate performance research, there are many defects, in the future remains to be further in-depth study.The innovation of this article mainly has three aspects. One of innovations is this article research samples for 41 of the general corporate bonds for the first time in 2011 listed companies, select financial indicators data in 2010-2013 to study relationship between corporate debt financing and corporate performance, relative to previous studies, stronger timeliness.Innovation point 2, the current domestic most is the first time on the study of corporate bonds issued the announcement effect of corporate debt, the study is the first issue of corporate bonds on the impact of stock price. For the study of the influence of corporate performance, corporate bonds in the research of some scholars is convertible bonds influence on corporate performance, and some scholars do not distinguish between types of bonds, the listed company of all existing bonds payable. This article in view of the listed companies to issue corporate bonds for the first time, analysis to issue corporate bonds impact on corporate performance from the static and dynamic perspective.Innovation point 3, on March 4,2014, the domestic bond market in the first bond defaults-super day debt defaults, this paper uses the event study method to study the effect of bond defaults on corporate performance.