A Study On The Effect Of Market-oriented Debt-to-equity Swap

With the outbreak of the economic crisis in 2008,China's foreign trade environment has undergone tremendous changes,met the double test of shrinking external demand and insufficient domestic demand.In response to this economic crisis,China has introduced a large number of economic stimulus policies.In recent years,the drawbacks of this measure began to emerge gradually.The leverage ratio of Chinese enterprises kept rising,the non-performing loans of banks increased year by year,and the debts of enterprises were too heavy.By 2016,many enterprises in our country have already appeared the situation of "high debt".To deal with this problem,the government has introduced many measures and put forward the task of deleveraging.In this context,a new round of market-oriented debt-to-equity swap as one of the important means of deleveraging,thus launched.At present,although China has carried out a debt-to-equity swap before,but the two debt-to-equity swap operation mode,conditions,objectives are different,so the new round of market-oriented debt-to-equity swap China is still in the exploratory stage.In addition,according to the statistics of Wind,we find that the new round of market-oriented debt-to-equity swap has the problems of large amount of contract signing and difficult landing.At the beginning of 2019,China's debt-to-equity signing funds reached more than 1.8 trillion yuan,the fund availability rate is only 25%.Therefore,we need in the original debt-to-equity on the basis of the market-oriented debt-to-equity analysis,to come up with a market-oriented debt-to-equity approach to the implementation of the background.According to the relevant policies and regulations of our country,the notice on specific policy issues in the implementation of debt-to-equity swap of market-oriented banks states that marketoriented debt-to-equity swap is allowed and comprehensive methods are allowed,carry on the stock right and the creditor's right union method to carry out the marketization debt to convert the stock in stages.The scheme is feasible.In this paper,China Railway market-oriented debt-to-equity swap as a case study object,on the basis of a large number of literature reading,the use of case study analysis methods,this paper makes a comprehensive analysis of a series of processes,causes and results of China Railway market-oriented debt-to-equity swap,and draws a series of conclusions.Through this market-oriented debt-to-equity swap,China Railway has significantly reduced the size of the debt and asset-liability ratio,improve the solvency and profitability.Successfully optimized the ownership structure of the enterprise,improve the corporate governance capacity,improve the operating efficiency.The social effect is well reflected,the stock price rises and fluctuates,which improves the enterprise value and is beneficial to the long-term stable development of the enterprise.For the follow-up use of such a way to market-oriented debt-to-equity enterprises,to give inspiration and reference.The research on the new round of debt-to-equity swap has great application value and theoretical value.In this paper,China Railway market-oriented debt-to-equity swap as a case study object,on the basis of a large number of literature reading,the use of case study analysis methods,this paper makes a comprehensive analysis of a series of processes,causes and results of China Railway market-oriented debt-to-equity swap,and draws a series of conclusions.Through this market-oriented debt-to-equity swap,China Railway has significantly reduced the size of the debt and asset-liability ratio,improve the solvency and profitability.Successfully optimized the ownership structure of the enterprise,improve the corporate governance capacity,improve the operating efficiency.The social effect is well reflected,the stock price rises and fluctuates,which improves the enterprise value and is beneficial to the long-term stable development of the enterprise.For the follow-up use of such a way to market-oriented debt-to-equity enterprises,to give inspiration and reference.The research on the new round of debtto-equity swap has great application value and theoretical value.