Analysis Of Determinants On Issue Credit Spreads Of City Investment Corporate Bond

In 2014,after the State Council issued No.43,the local government financing platform issued corporate bonds shall not be added local government debt,resulting in a substantial reduction in the total amount of city investment corporate bonds.In 2015,the National Development and Reform Commission began to relax the issuance of corporate bonds conditions,and to simplify and accelerate the corporate bond approval process,making the city investment corporate bonds in 2016 to return to prosperity.After two years of policy adjustment,issuance and transaction of city investment corporate bonds gradually standardized,by the government directly to repay the obligation to the market recognition of the government implicit guarantee,city investment corporate bonds have already entered a new stage of development.At the new stage of development,the research on the factors affecting the credit spreads of the city investment corporate bonds is still blank.The research is of great significance to the National Development and Reform Commission,the local government,the investors and the theoretical circles.This paper studies the influencing factors of issue credit spreads of city investment corporate bonds by empirical analysis.This article selected the corporate bonds issued after 2015 National Development and Reform Commission relaxed the issuance of corporate bonds as a sample,a total of 18 influencing indexes were selected from the four aspects of macro,region,bond itself and corporate finance as explanatory variables,and then the first three aspects as a non-financial factors and the issuance of credit spreads to build multiple regression model,and then financial factors and the issuance of credit spreads for multiple regression,and finally get the all-factor model of issue credit spreads of city investment corporate bonds.In this paper,through empirical evidence:macroeconomic factors,GDP and money supply growth on the issue of credit spreads have a positive impact,GDP and money supply growth rate is greater,resulting in higher inflation expectations,thereby increasing the possibility of raising interest rates on the central bank,the risk of bond prices increased,resulting in the issuance of credit spreads widened.The degree of corporate bond market boom has negative impact on the issuance of credit spreads,which is,the more prosperous corporate bond market,the more active the secondary market transactions,reducing the liquidity spreads of corporate bonds and government bonds,thereby narrowing the corporate credit spreads.In terms of regional factors,the local administrative level has a significant impact on the issuance of credit spreads for corporate bonds.With the increase of the local administrative level,the credit spreads are narrowed.The behavioral characteristics of local government have a significant impact on the credit spreads of city investment corporate bonds.Eastern,central,western and northeastern regions due to differences in government behavior characteristics,the spreads are expanded in turn.The above results show that,at the new stage of development,the regional factors are still the important factors influencing the credit spreads of the city investment corporate bonds.The municipal properties of city investment corporate bonds are still strong.In terms bond elements,the size of the bond issuance,the maturity date of the bonds,the credit rating of the bonds and the strength of the underwriters have a negative impact on the credit spreads of the corporate bonds.The credit measures are positive for the issue credit spreads influences.The larger the issuance of bonds,the longer the issue period,the higher the credit rating,indicating that the issuer is larger,comprehensive strength is stronger,more susceptible to market welcome,narrowing the issue of credit spreads.The stronger the overall strength of the underwriters',the stronger the bond sales capacity,the better customer resources,the lower issuance costs for the issuer,and the narrowing of the credit spreads.The credit rating is the same,if there is credit measures,indicating that the issuer's main rating will be lower,the issuer's main strength will be weaker than the non-credit measures of the enterprise,solvency is relatively weak,resulting in the issuance of credit spread widening.Financial factors,there is a discrepancy with the theory,the company size,profitability and financial leverage on the issue of credit spreads have a negative impact.The larger the company,the stronger the profitability,the smaller the issue of credit spreads,in line with the actual situation.The higher the asset-liability ratio,the smaller the credit spread issue,which is contrary to common sense,but also with the general corporate bond credit pricing theory is the opposite.From the market-oriented company's point of view,the higher the debt ratio,the greater the financial risk,relatively speaking,the less solvency.But for the government financing Platform Company,from the investor's point of view,it can be argued that the higher the debt ratio under the established debt ratio,the greater the government support is,and the risk of debt repayment will be smaller.In addition,the financial factors in addition to the above three indicators significant,the other three indicators are not significant,and non-financial factors and financial factors to build a regression model,the model has a lesser degree of explanation than the non-financial model.Once again shows that the financial situation on the issued credit spreads less affected,but also once again support the local government on the new stage of development of the city investment corporate bonds issued credit spreads have a greater impact,there is still a strong municipal properties.