Research On The Causes And Prevention Of Bond Default Of Listed Companies

Since the resumption of bond issuance in 1981,the scale and quantity of bond issuance in China have been greatly improved.But with the continuous development and maturity of China’s bond market,the risk of default also increases.At present,China’s bond market is still in a gradual improvement of the development stage,the level of its market-oriented operation is relatively low.With the development of the bond market,the default of corporate bonds is inevitable.In addition,with the release of the deleveraging policy in our country,the company increases the leverage ratio while reducing the production capacity,which makes it difficult for some companies that used to rely on a lot of borrowing to adapt to the new policy development.At the same time,the occurrence of China’s bond credit crisis and the tightening of the financial environment have caused the investment costs of some companies to rise.However,due to the reduction of financing channels,the pressure on companies to pay off their bonds has become greater and greater,in recent years,the number of bond default events and the amount of default have increased significantly.In recent years,listed companies have become a high incidence group of bond defaults in China.The aggravation of bond default risk not only brings great bad influence to the listed companies and investors,but also brings negative influence to the sustainable and healthy development of financial market.How to prevent the occurrence of bond default,maintain the stability of the bond market,protect the interests of investors,is a subject of great significance.Under this background,this paper chooses the listed company as the research object,and makes a comprehensive analysis on the occurrence,causes and risk prevention of the bond default of Xinhualian.First of all,the paper analyzes and summarizes the domestic and foreign problems about bond market risk,bond default causes,risk prevention and so on.Then,it gives a detailed introduction to the general situation of Xinhualian Holding Co.,Ltd.and the situation of bond issuance,the whole process of the default of corporate bonds is reviewed,and the main problems before and after the default of corporate bonds are reviewed.On this basis,the article focuses on the company’s strategic level,governance level,financial level of the Xinhualian bond default reasons for in-depth analysis.At the same time,through the analysis of the internal operation and financial situation of the new hualian company,we can see that when the new hualian company makes overseas investment,as its investment returns and profits are not very good and it has spent a lot of money on mergers and acquisitions during its operation,these activities have led to a sharp drop in net profit in recent years,financial stress increases dramatically as the funding chain breaks.Has increased the chances of a bond default.Finally,from the company’s own point of view,the default risk of private company bonds put forward targeted recommendations.The purpose of this paper is to discuss the problem of bond default of listed companies in our country,and put forward some effective countermeasures to prevent bond default from the company’s own point of view,to help relevant parties fundamentally safeguard their own realistic interests.The company should strengthen its own internal control and management,adopt the management and development strategy suitable for the company,and avoid blind investment.We should also strengthen the company’s management level,improve the internal control system,so as to reduce or avoid the risk of bond default.