Research On Equity Pledge Of G Bank’s Controlling Shareholders

Equity pledge is the behavior of pledgor to pledge his own equity to banks,trusts,securities and other financial institutions to obtain funds.With the development of economy,equity pledge has become an important channel for shareholders of Listed companies to conduct debt financing in the capital market.In general equity pledge business,financial institutions often play the role of the pledgee,but if the pledge party is financial institutions,equity pledge to the financial industry and even the whole real economy of the risk is far more serious than people think.Based on this,on the one hand,this paper adopts the event study method to systematically investigate the influence of equity pledge of controlling shareholders of listed financial institutions(banks,insurance and securities companies)in China’s A-share market and the regulatory policies of financial industry equity pledge issued by regulatory authorities on stock prices.Systematically evaluate the equity pledge of financial institutions and the impact of industry equity pledge supervision on financial institutions from the perspective of the industry in which G Bank is located;On the other hand,through the case analysis of G Bank’s equity pledge,this paper systematically analyzes the influence of controlling shareholder’s equity pledge on G Bank,and then puts forward suggestions for G Bank and financial industry’s controlling shareholder’s equity pledge management.This paper shows that,first,the regulatory policy issued by equity pledge regulatory policy has a negative impact on the stock price of the financial industry as a whole,but the banking regulator for the first time issued the industry equity pledge management measures brought a positive market reaction.Second,financial institutions,new equity pledge of pledge of at the same time the new pledge of settlement behavior of cumulative average abnormal returns significantly negative,while all the pledge to produce significantly positive cumulative average abnormal returns,suggests that investors of equity pledge against financial structure and financial institutions to solve all the pledge can obtain active responses to the stock market.Third,from the perspective of shareholder structure and the purpose of equity pledge,this paper analyzes the case of G Bank’s equity pledge and finds that equity pledge has a double negative impact on the bank’s stock price and financial performance.Based on the above findings and equity pledge theory,the author puts forward management suggestions on equity pledge of G Bank and controlling shareholders in the financial industry.The research conclusions of this paper not only provide important evidence and theoretical reference for the effective supervision of equity pledge behavior of financial institutions,but also provide experience for risk avoidance and operation improvement of financial institutions including G Bank after equity pledge events.