Study On Credit Risk Of City Investment Bond In China Based On Empirical Analysis Of Traffic Bond

The State Council introduced the "43" policy and the approval of new budget law,this makes the significant changes have taken place that the status of the city investment company and city investment bonds than before,this series policies striping the ownership of local government and the city investment company,the local government shall not provide explicit and invisible guarantees for bonds,when the local government complete the debt exchange after 2017 that the company's debts no longer belong to the local government debt,local government is no longer have direct or indirect responsibility to debt,the local government want to support city investment company only through assets injection,and can no longer rely on its back to its debt to the credit of local government endorsement,so investors will pay more attention to the company's financal situation.Therefore,in this paper,choose the city traffic debt as the study object,the traffic company has main business compares to the pure public welfare bonds,with a stable source of income,degree of dependence on the local finance,more in line with the logic of debt investors investment industry.Combined with a case analysis of the traffic bonds,Choose this case to analys is because Ningbo traffic company has clear main business,profitability is much better than other types of city investment company,but this company for two consecutive years of losses,the company was suspended for processing in 2016,but its credit rating has not been lowered.To understand the meaning behind some of the special subject through study the city traffic company's balance sheet,income statement and the cash flow statement.In order to identify the risk factors affecting their financial condition.In the empirical part,comprehensive consideration of a serise of new policies like the "43" policy influence on the bond market and the availability of data,finally this paper select 33 traffic bonds issued after 2014 as the empirical object.First of all,through the factor analysis of financial data to reduce the variable dimensions,then setting up Ordinal Logistic Regression Model,getting the results of empirical test.The empirical results showed that the overall model fitting effect is good,traffic classical city investment company's solvency?capital structure?ability of cash flow?the main business profitability?government support?the local economic development level?the condition of local fiscal revenue and expenditureguarantee rights index and the optimum letter,the more beneficial of the index to reduce the credit risk,to reduce the probability of default.In addition to examining the empirical models,based on Ordinal Logistic Regression Model city investment bonds defaults measurement model for simple model and higher predict rate.The results show that the model is simple and easy to operate and has a certin capable of predicting default probability.Finally,the article puts forward policy suggestions:the local government should strengthen risk awareness,play a positive leading role,strengthen the management of transportation investment company,establishing and perfecting the information disclosure system of city investment company,improve the bond credit rating market,increase the protection to bondholders.