Related Network And Bonds' Credit Spread

With the development of financial system and the increasing complexity of inter firm association network,the trade-off between risk sharing and risk contagion effect brought by association network has become an important research topic.In recent years,with the rapid development of China's corporate bond market,corporate bond default events also occur frequently.The research on corporate bond credit risk has attracted extensive attention of investors and government.In reality,the expansion of listed companies,the risk sharing and contagion of subsidiaries and related companies are all important factors affecting the corporate bond's credit risk.At present,the research on corporate bond credit risk is mostly from the perspective of macro factors,micro factors and bond characteristics.In this paper,the research on corporate bond credit risk is based on the characteristics of companies' association network,which provides a new perspective for bond credit risk research.The paper uses the visualization technology to construct a visualization network for the association relationship data of listed companies and their associated companies in China.Some listed companies maintain a relatively stable network status for several consecutive years,and many other companies' network characteristics show a certain trend of change annually.Based on a series of node network characteristic data obtained by network algorithm,which can be used to measure the relevance,importance,centrality and diameter of network nodes,this paper construct a series of intermediary variables such as corporate profit performance,information openness and capital structure to conduct a path analysis of the associated network's effect on the credit spread of corporate bonds.The results of empirical analysis show that,with the index improvement of the relevance,importance,centrality and diameter,the market's expectation for associated network's the risk sharing effects is greater than the risk contagion effects.The listed companies with high level of relevance,importance,centrality and wider network diameter tend to have lower credit spread.The path analysis shows that the expansion of Enterprise Association helps to enhance the profitability of enterprises and then reduce the bond credit spread,but the increase of multi-level association also reduces the quality of enterprise profitability to a certain extent.The related network reduces the level of information asymmetry between enterprises and investors,which reduces the credit risk of enterprises.At the same time,the expansion of the network on the enterprise reputation and external resources access channels will also increase the debt financing dependence of listed enterprises.In addition,the effect of the related network on the corporate bond credit spread is more significant in the sample of state-owned enterprises.The results of this study show that the diversification of the relationship between companies has played a positive role in reducing the credit risk and financing cost of the listed company,and the results also provide a network perspective for the relevant policies of corporate bond risk prevention and control.