Effects Of Holding Financial Institutions On The Corporate Financing Structure Of Entity Enterprises

As the financial industry of China has been using a separate business model,the financial institutions can not directly take the initiative to hold the other entities.With the reform and development of financial deregulation in the financial industry of China,more and more entity enterprises devote to holding the financial institutions and get involved in the financial sector,which promotes the development and prosperity of holding financial institutions,hoping that the financial business can serve as the company’s engine,optimize the corporate finance,and achieve a healthy interaction between finance and entity industry.In the past,the study of the holding financial institutions was focusing on the mitigation of credit constraints and the business performance,but lack of the details of corporate finance structure and financing decision in the face of financing gap when entity enterprises devote to holding the financial institutions.This paper studies the impact of the entity enterprise’s financial structure imposed by holding financial institutions from theory and practice,and adopts the samples of non-financial entity enterprises in Shanghai and Shenzhen A-share markets from 2010 to 2015 for empirical research.The paper is divided into six chapters,the main contents are as follows:This paper first discusses the effects of the holding financial institutions which is one of the financial-industrial integration patterns,as well as the financing structure theory of the corresponding entity enterprises.It provides the theoretical basis,research assumptions and analysis ideals for the analysis of the effect and financing structure.Secondly,this paper use the multivariate statistical measurement,establish the relevant empirical model,and then study the influence of the holding financial institutions on external financing(debt financing,equity financing)and internal financing to test the research hypothesis.After theoretical analysis and empirical research,this paper finds that:(1)Relative to the entity enterprises of non-holding financial institutions,the entity enterprises of the holding financial institutions have higher level of debt financing.But its equity financing and internal financing have nothing change.The results show that the holding financial institutions can contribute to increasing the credit financing of the financial institutions to the entity enterprises except the equity financing and internal financing.(2)Further research shows that the holding financial institutions are beneficial for the entity enterprises to optimize the debt financing structure,which means that the holding financial institutions can increase the proportion of short-term debt financing and reduce the increment of long-term debt financing.The results show that holding financial institutions are beneficial for the entity enterprises to choose the preferred low-cost short-term financing.(3)when the entity enterprise holds financial institutions,its debt financing,short-term debt financing and endogenous financing are more sensitive to the financing gap,its long-term debt financing is opposite,its equity financing is not sensitive to the financing gap.The results show that when the entity enterprise holding financial institution is facing financing gap,it will give priority to debt financing(especially short-term debt financing)and equity financing.This paper,based on the view of the holding financial institution,studies the financing structure of the entity enterprises,develops the theory of enterprise financing structure and the theory of financial reform,which is of great significance for the entity enterprises to use this financial-industrial integration pattern to improve the financing structure of the enterprise.