| In recent years,China’s bond market continues to develop,the issuance system of the market is gradually comprehensive,the scale of bonds continues to expand,and the market has become an important place for financial investment and capital exchanges.However,some problems have gradually emerged in the process of rapid development.Among them,the frequent occurrence of breaches of contract makes credit risk become a more and more important issue.In March 2014,the default of "11-day bonds" was the first case in China’s public offering market that failed to pay in full at maturity.Since then,bond defaults have occurred frequently,and reached the highest level in 2018.Among these frequent bond defaults,DONGBEI Special Steel’s default is the first public offering default of local state-owned enterprises in China,and it is the first time that it has broken the rigid payment of local state-owned enterprises.This paper expounds the issuance of China’s credit bond market,summarizes the default situation of China’s bond market and the characteristics of market default.Then,by reviewing the incident of DONGBEI Special Steel Group,this paper combs the whole process from breach of contract to post-processing.Then,by summarizing the content of literature review and the characteristics of this case,this paper uses Harvard analysis framework as the analysis framework of this case,studies and analyses the default factors of DONGBEI Special Steel Bonds from four aspects:extermal factors analysis,strategic decision analysis,accounting information quality analysis and financial situation analysis.This is the core of the whole paper.External factors are mainly due to the government’s invisible guarantee,the excess capacity of the steel industry,and the low-end structure of special steel products.In strategic decision-making,the main problems are that overdependent on bond financing,short-term and long-term investment decision-making errors,and lack of responding to crisis.In the aspect of accounting information,the main problems are insufficient information disclosure and possible fraud of the information disclosed.In terms of financial situation,it is mainly due to the excessive liabilities and unreasonable structure of DONGBEI Special Steel Group,the decline of profits caused by high costs,and the fragility of capital chain caused by liquidity shortage.Subsequently,this paper puts forward some countermeasures on how to prevent bond default from the perspective of regulator and enterprises.From the perspective of enterprises,it mainly includes choosing Bond Financing way carefully,establishing crisis response mechanism,consciously fulfilling information disclosure obligations and strengthening cost and liquidity management.In terms of supervision,it is necessary to remove the invisible guarantee for enterprises and establish an early warning system.Finally,the paper summarizes the research and analysis of the full text,and makes a outlook of the vigorous development of bond market.This paper hopes to give full play to the typical significance of this event and avoid the risk of future default events through the analysis of the whole case of DONGBEI Special Steel,and then give relevant suggestions on how to prevent bond default from enterprises and regulator.At the same time,I hope to increase the innovation of my own research on the original research results,to provide more abundant research for avoiding bond default,and to contribute to strengthening and improving the credit environment of the bond market. |
