Research On The Financial Effect Impact Of Market-oriented Debt-to-equity Swap Of Leveraged Firm

With China's economic development entering the "new normal" and economic growth slowing down,debt-for-equity swaps,as an important tool for deleveraging,have again come into people's sight after 17 years,in order to cooperate with supply-side structural reform,reduce corporate leverage ratio and reduce Banks' non-performing assets.This round of debt-for-equity swaps emphasizes the principle of market orientation and legalization,with the main purpose of deleveraging.At the same time,the debt-for-equity swap has helped reform the ownership structure of state-owned enterprises and improve corporate governance.The debt convertible emphasizes the principle of marketization,the government no longer do work out,so now there is a signed debt-to-equity swap enterprises and implementing more difficult,and the marketization of CSICL as the first to participate in debt turn of large state-owned enterprises,study the origination,operation mode and the subsequent effect on whether there is a need to other enterprises in our country has important reference value for the implementation of debt turn.This paper USES the literature research method to sort out the basic concept,operation mode and related theories of debt-to-equity swap,and then carries out a specific analysis and research on CSICL through case analysis.This paper explains the specific motivation for CSICL to implement market-oriented debt-to-equity swaps in the current environment,mainly including macro policy support,the trend of the industry situation,and the needs of enterprise operation conditions.It also analyzes the necessity of CSICL to participate in this round of debt-to-equity swaps.Then,the paper analyzes and studies the specific steps and exit path of CSICL's debt-for-equity conversion,mainly focusing on the unique "two-step" mode of CSICL and the research and thinking on the exit path of marketization.Based on the changes in financial indicators,corporate management structure and corporate value before and after the debt-to-equity swap,the paper analyzes the impact of market-oriented debt-to-equity swap on the debt-to-equity swap financial performance of CSICL.Through the above research,it can be found that the debt-to-equity swap in CSICL has achieved initial results,with the asset-liability ratio of enterprises dropping by 11.39% and the financial indicators improving to varying degrees,indicating that the debt-to-equity swap is conducive to reducing the financial pressure of enterprises,improving the corporate governance structure and increasing the corporate value.Based on these conclusions,this paper summarizes the implications of three aspects of market-oriented debt-to-equity swaps :(1)strictly select the target enterprises of debt-to-equity swaps;(2)adhering to the principle of marketization;(3)improving relevant laws to ensure the effectiveness of market regulation.In order to provide some ideas for the future implementation of market-oriented debt-equity swaps in China,and bring some enlightenment and reference to similar enterprises in the implementation of debt-equity swaps.