Research On The Influence Of Financial Intermediary On Bond Credit Spread

In China,"investment banking business" mainly includes two categories:stock issuance and bond issuance.Unlike IPO,due diligence is not detailed enough in the process of bond issuance.Although regulators explicitly require that all intermediaries should undertake due diligence independently and disclose relevant information,underwriters should do due diligence on financial data Often rely on the audit reports of accountants,in this case,there will be some duplication of work between underwriters and audit institutions.On the other hand,in the process of bond issuance,the audit of regulatory agencies is relatively relaxed,while the responsibilities of intermediaries who are obliged to conduct due diligence and prepare application materials are correspondingly enhanced.The professional competence of intermediaries is the basic guarantee for accurate disclosure of bond information,so the choice of intermediaries will also have an impact on the credit spread of bonds.Based on the above two points,this paper expects that the influence of underwriter and Auditor Selection on bond credit spread depends on the choice of the other party,which is reflected in the interaction of agency selection that will weaken the influence of single agency on credit spread.Based on the existing literature and practical experience,this paper analyzes the theoretical influence of the combination of underwriters and audit institutions with different qualifications on the credit spread of bond issuance from the aspects of due diligence overlap,marginal decline of signal transmission,supervision in advance,hidden guarantee,etc.,and selects whether the underwriters are the first or not based on the samples of urban investment bonds and non urban investment bonds issued between 2009 and September 2019 Whether the top ten underwriters and audit institutions are the "four" or "eight" and their interaction terms are the main explanatory variables are analyzed by regression analysis and tested by robustness,which partially verifies the hypothesis proposed in this paper.Through research,this paper finds that:for urban investment bonds,the situation of local government is the most important factor affecting the credit spread,the choice of intermediary agencies will not significantly affect the credit spread of urban investment bonds,and the impact of different qualification of the combination of intermediary agencies on the credit spread has no obvious difference;for non urban investment bonds,the situation of the issuer is the most important factor affecting the credit spread,the intermediary mechanism The choice of structure will significantly affect the credit spread of non urban investment bonds.Specifically,there is no interaction between underwriters and auditors of medium-term notes.The interaction between intermediaries of corporate bonds is reflected in the weakening of the influence of underwriters and auditors on bond credit spread.Based on the conclusion of this paper,this paper suggests that the regulatory agencies should strengthen the supervision of the Underwriters' work situation of relying on Accountants in due diligence,and promote the intermediary agencies of securities issuance to provide the market with real and accurate data obtained independently.