Influencing Factors Of Controlling Shareholders' Equity Pledge

In 2013,the on-site pledge business channel was opened,the equity pledge business developed rapidly in China,and the risk events caused by the equity pledge of the controlling shareholders occurred frequently.Some of the controlling shareholders even pledged all their shares for financing.The stock pledge business of controlling shareholders connects many stakeholders such as listed companies,commercial banks,securities companies and general investors.Once the risk of closing positions of Pledged Shares occurs,it will endanger commercial banks,securities companies and general investors.It can help commercial banks and securities companies to prevent and resolve risks by studying the influencing factors of controlling shareholders' equity pledge,and help financial regulators to improve the financing management mechanism and open up financing channels for enterprises.Based on the existing literature,this paper studies the influencing factors of controlling shareholders' equity pledge from the following three questions: first,are controlling shareholders willing to carry out equity pledge? Second,why do the controlling shareholders pledge their shares? Third,when will the controlling shareholders choose to pledge their shares? Based on the theory of control right,the theory of Priority Financing and the theory of market timing,this paper makes a preliminary analysis of the above three questions,and sums up three factors: the proportion of controlling shareholders,the financing constraints of listed companies and the valuation level of listed companies to answer the above three questions;based on the data of A-share listed companies in Shanghai and Shenzhen from 2014 to 2018,the multiple linear regression methods of OLS and Logit are used respectively,This paper makes an empirical test on the factors that affect the equity pledge of the controlling shareholders of listed companies.The research of this paper shows that: the proportion of controlling shareholders in listed companies,the financing constraints of listed companies,the valuation level of listed companies have obvious correlation with the equity pledge of controlling shareholders.Whenthe shareholding ratio of the controlling shareholder is low,the shareholding ratio of the controlling shareholder is positively related to the equity pledge;when the shareholding ratio of the controlling shareholder is high,the shareholding ratio of the controlling shareholder is negatively related to the equity pledge.The degree of Financing Restriction of listed companies is positively related to the pledge of controlling shareholders' equity.The valuation level of listed companies is positively related to the equity pledge of controlling shareholders.