| The nature of bond is debt security, an authorized and legal certificate to repay borrowed money. In China, the total of our bonds has increased a lot, and the types have been greatly enriched. However, the share of corporate bond is still too small. The financial channel of corporate bond isn’t well developed. And one of the most important aspects to develop corporate bond market is to improve our credit ratings market.In the current market environment, credit is the core of economy and financial system. This phenomenon is far more apparent in bond markets. First, the bond markets are based on credit; Second, in perfect bond markets, the credit degree of the issuers determines the acceptance of their bonds, and the bonds’credit rating themselves determine their prices and issuing patterns. In this point, improving our credit rating industry is vital to the development of our country’s bond market.However, Chinese credit rating industry is still in its infancy period. There are also many problems in the bond rating industry. As quasi-government bonds, corporate bonds’interest rates have been controlled. Although companies are rated, the companies having different credit rating issue bonds at the same interest rate. Bond ratings become a test of qualification, interest rate is determined by the Government. This inspires us to think what China’s credit rating industry and the degree of its influence on the bond market look like. This is what the paper mainly researches.By describing the existed articles from home and abroad, the article applies qualitative and quantitative analysis on the status of Chinese credit rating industry. In the quantitative part, the paper uses the true interest cost model and the event study model, and find that both in the primary market and the secondary market of our bond market, our credit ratings play some influence. Finally, according to the problems, the article proposes some suggestions to develop our credit rating industry. |
