Research On The Legal Issues Of Commercial Banks’ Market-oriented Debt-to-Equity Swap

The market-oriented debt-to-equity swap of commercial banks means that under the background of marketization and the rule of law,commercial banks convert financial claims on enterprises into equity investments in enterprises.Its operating mechanism is highly compatible with the deleveraging purpose of my country’s supply-side structural reforms.With the support of policies and systems,it has become an increasingly common legal phenomenon in our country.This article discusses the legal provisions of commercial banks’ non-performing assets market-oriented debt-to-equity swap from the perspectives of transaction law supervision and financial supervision.In the first part,the author briefly introduces the basic theory of debt-to-equity swaps,intending to clarify the theoretical framework of debt-to-equity swaps and the legal logic of its operation,and describe the rule of law environment of market-oriented debt-to-equity swaps.In the second part,the author pointed out that in the implementation of market-oriented debt-to-equity swaps,two legal systems have been formed with banks as the coordinate axis.The first is a horizontal legal system that regards banks as the main body of the market economy and is dedicated to promoting the fundamental role of market resource allocation.The second is the vertical financial supervision legal system that regards banks as the object of supervision,and the two sets of legal systems have adjustment gaps.With the in-depth implementation of market-oriented debt-to-equity swaps,the legal problems existing between the two will have an adverse impact on the realization of the market-oriented debt-to-equity swap policy and the realization of financial regulatory goals,and will continue to appear:there are a large number of “non-prohibited” negative list regulations in the horizontal legal system,however,the rules of the negative list are too principled,resulting in low operability and vague legal standards;the vertical supervision system stipulates stringent access conditions from the perspective of maintaining financial stability,but due to its own lagging characteristics,there are institutional gaps in related transaction control,risk early warning mechanism construction,and information disclosure.In view of this,the author believes that the realization of the value of the market-oriented debt-to-equity swap system of commercial banks depends on the establishment of a clear standard legal system for market activities,and to establish a financial legal system that focuses on functional supervision and is appropriately flexible.In the third part,it puts forward suggestions for improvement from a practical point of view.