A Research On Relationship Between Underwriter Reputation And Financing Excess、Efficient Use Of Over Raised Funds

High issue price, high price-earnings ratio and over raised funds that "Three high" phenomenon frequently appears in the GEM companies, over raised funds is the part of listed companies actual raise funds more than expected to raise funds, Large quantities of over raised funds are unused, and affecting the capital markets optimum distribution of resources,what’s more, crowding out the enterprise’ financing space that real needs of funds to develop. Since2004, China began to implement the sponsor system, Gives third-party actors decision-making power to judge whether listed companies to comply with the conditions listed issuers. So In the pre-listing stage, Underwriters screen company to be listed, Shouldering the responsibility of ensuring the overall quality of the company to be listed and full disclosure relevant information. After recommend the company successfully issued, underwriters need review and oversight of listed company in the period of continued supervision.Underwriters throughout the IPO process, their behaviors have a significant impact on the healthy and stable development of the securities market issuance. First, the securities contact intends to listed companies and investors and can effect "over raised" phenomenon. Underwriters are reliable "information producers" and "certifying agent" in securities market, as the position of third parties, Underwriters transmit valuable information to investors that can effectively reduce the possibility of information asymmetry between issuing company and potential investors, such as production and operating results, financial situation, development potential and investment prospects of listed Companies. so underwriters can inhibit "adverse selection" problem. Underwriter’s reputation is the basis of playing certification role, so ensures that efficient delivery valuable information to investors. Underwriters own "non-salvageable reputational capital" can increase "credibility". Thus better reputation underwriters can more accurate and reliable transfer information of the company, Increasing the probability of investors to determine the actual value of the company to be listed on the right, making investors are willing to pay higher prices to promote the actual issue price of IPO and generated "over raised". Second securities underwriter and sponsor are the same identity that underwriters have ability to impact on listed companies how to use over raised to invest. In order to safeguard the reputation and future earnings, the higher reputation underwriters trend to strengthen the efforts of reviewing and monitoring listed companies, continued analysis and evaluate the listed company’s main business growth opportunities, continuous development opportunities and possible risk, and analysis the use of raised funds with scientific, feasibility, economic analysis, to ensure the efficiency of the use of funds.In this paper, from the of asymmetric information theory, signal theory and certifying agent theory, recalling the study of domestic and foreign scholars on the reputation of underwriters and listed companies over raised and the use of over raised funds in IPO process. More profound theoretical analysis of listed companies IPO "over raised" phenomenon and the use of over raised funds. In this paper,281listed companies from October2009to December2011as the research sample, manually collecting data of the actual over-raised funds and investment of over raised funds.Binding data analyzes the raised funds, investment of raised funds and relevant variables for statistical description. Then regression analysis of variables, testing the relationship of underwriter reputation with over raised and the efficiency investment of over raised funds. For the content of this paper, this paper intends to adopt the idea is as follows:The first part focuses on introduction of explaining the scope, background, purpose, significance of this research, innovative research ideas and frame works.The second part is the theoretical basis of combing and literature review, Theoretical study is divided into three parts, asymmetric information theory, signal theory and certifying agent theory, And recalls the relevant underwriter reputation with over raised financing and efficient use of over raised funds.The third part is describes the theory about underwriter reputation, including the definition of underwriter reputation and the measurement methods about underwriter reputation.The fourth part is the empirical research, variable definitions and model design. Using descriptive statistical analysis and regression analysis from the two aspects, including the underwriter reputation and over raised financing, underwriter reputation and the use of over raised.The fifth part is on the basis of theoretical analysis and empirical research results, will be depth analysis and summary the underwriter reputation and over raised financing, underwriter reputation and the use of over raised. Make recommendations to promote the development of securities market.Results of this study prove that:first, the underwriter’s reputation can be used as a signal, according to underwriter reputation variable values investors can distinguish the difference between reputation. High reputation underwriters and GEM listed company over raised emerged a significant positive correlation, the better the underwriters, the more over raised funds. underwriters as a signal "information production" and " certification " functions can be verified in the model, high reputation underwriters can alleviate information asymmetry investors can reference reputation underwriters in order to accurately assess the value of listed companies when make decision to invest shares. Second, in order to safeguard the reputation of capital and future benefits, the underwriter reputation with the use of over raised funds for capital investment was a significant positive correlation, that reputable underwriters underwriting GEM companies for the high proportion of over raise funds for capital investment while low reputation underwriters underwriting company use less funds on investment, under the guidance of regulatory policies good reputation underwriters exercise effective supervision of listed companies underwriting.To a certain extent have positive impaction the effective use of over raised funds.Innovation of this paper:the existing literature focused on the study of the relationship between the majority of underwriter reputation and IPO underpricing, distribution efficiency, system innovation, IPO enterprise quality, IPO initial and long-term returns of five points, and no literature related to underwriters research reputation and "raised" phenomena. From the theoretical point of view, the so-called "super-raised" phenomenon does not exist in foreign and domestic scholars "Raised" inadequate attention given to the phenomenon, there is currently a shortage on "Raised " study the issue. This article combines innovative sponsor system background, targeted analysis demonstrates China Sponsor underwriter is how it affects the reputation of the GEM listed companies raised over the efficiency and financing of listed companies raised funds. To determine whether investors can make efficient use of funds raised over the future of the listed company’s reputation through features in order to make investment decisions for long-term market returns, the relevant regulatory authorities can conduct for listed companies, underwriters conduct sponsor for this relationship constraints, prompting rationalization of allocation of social resources, and promote the sponsor underwriter reputation evaluation mechanism, incentive mechanism can be more perfect bound, efficient operation.