Listed Companies In China Convertible Bond Issues

More than a decade on since its inception, the Chinese securities market, finding itself in an increasingly prominent role, has become an important platform for nationwide disposition of resources and structural adjustments. It has also evolved into a "barometer" of economic activity. On the Chinese securities market at the start of a new century, high-profile events have kept on emerging in an endless stream, from the entry of insurance funds to the delisting of PT Shuixian, from the launch of open-ended investment funds to the state-share sale programme. On 26 April 2001, China Securities Regulatory Commission (CSRC) promulgated "Implementation Procedures Concerning Convertible Bonds of Corporations". Immediately afterwards, several Corporations announced, in succession, that they were planning to issue convertible bonds. Thereupon, financing through convertible bond issues became all the rage. Within this context, studies on the issues related to convertible bonds appeared on the priority research agenda of the theoretical research community. This paper is a study on convertible bonds as a complex class of securities on the basis of a survey of the findings of earlier research work and by citing examples of convertible bonds that are already in existence on China's securities market.This paper is in four parts, namely:Part I. A General Survey of Convertible Bonds - an introduction to the characteristics, basic elements and fundamental issues of classification in respect of convertible bonds;Part II. Development of Convertible Bonds in China: Past and Present;Part III. How Corporations in China Raise Finance Through Convertible Bond Issue - an explanation on why Corporations choose financing through convertible bond issue; timing of issue, design of terms and conditions and procedural issues critical to the financing process;Part IV. Implications and Problems of Convertible Bond Issue by Corporations in China - a review of the implications of convertible bond issue by Corporations in China and an analysis of the problems hindering the development of convertible bonds issued by them, with recommendations.