| In recent years,the development of private financial enterprises are faced with the unprecedented opportunities,which are the reforms like “Mass innovation and innovation” or “Streamlining government and delegating authorities”,and also faced with the unsound internal governance structure or the risk of external investment environment change.In particular,with the opening up of the financial market and the rising of private Financial enterprises in China,it should be focused on a series of problems,such as how to deal with external financial risks and poor internal governance due to their autonomy and private nature.Because of that,it is necessary to pay attention to the situation of time-inconsistent preference,which come from the differences between current and future entrepreneurs' preference degree or continuous intensity of preference interval.These can lead to the changes of the discount rate of enterprises the current and future enterprises,thereby indirectly affecting the value of enterprises and investment and financing decisions.These make entrepreneurs disagree on current and future discount rates,which indirectly affect enterprise value and investment and financing decisions.In addition,as an important financial innovation to cope with the financial crisis,many financial enterprises have issued a large number of CCB in recent years.In view of this,this paper considers the time-inconsistent preference of private bank entrepreneurs,analyzes the influence of CCB issuring on the capital structure of private financial enterprises,and studies their investment and financing decisions.First of all,this paper reviews domestic and foreign scholars' researches related to the time-inconsistent preferences of entrepreneurs,pricing of contingent convertible bonds and the decisions of corporate investment and financing.It summarizes these researches trends and shortcomings.And then it analyzes the advantages and disadvantages of private financial enterprises' autonomous management,the behaviors of entrepreneurs' time-inconsistent preference and the economic basis of CCB financing.Then,under the time-inconsistent preference of entrepreneurs and different financing methods,based on the hyperbolic discounting function model and the asset pricing theory,the paper constructs the research framework of enterprise securities pricing.What's more,under the condition of company value maximization and different preference of entrepreneurs,it is deduced the analytical solution of optimal coupon,equity value,value of ordinary bond,value of CCB,and corporate value respectively.It also analyzes the influence of time-inconsistent preference on the optimal coupon,enterprise bankruptcy,and leverage ratio under different financing methods.It is concluded that under the management of mature entrepreneurs,private financial enterprises can reduce the optimal coupon,enhance the ability to resist external risk and weaken shareholders' risk transfer motivation by issuing CCB,rather than single common bond financing,which makes the more weak.Finally,based on the real options approach,this paper studies the investment decision of the corporate under the condition of CCB financing and entrepreneur time-inconsistent preference.By assuming fixed company financing cost,the investment option value and investment trigger level is solved whether the entrepreneur is time-consistent preference or time-inconsistent preferences.By using numerical simulation method,it analyzes the impact of time-inconsistent preference on investment option value and investment trigger level.The results show that,under the management of sophisticate entrepreneurs,private financial corporates with CCB financing can reduce the investment level to accelerate investment,but it will reduce enterprise value.Generally speaking,firm value will be higher,if entrepreneurs have time-inconsistent preference.These theoretical innovations are important to the capital structure design of developing private financial enterprises financing with CCB. |
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