A Study On Default Risk Of Corporate Bonds

In recent years,China's bond market has went through a great change,especially corporate bonds as a direct financing tools of enterprises have greatly increased.It's a common sense for investors overseas that the problem of bond default is an inevitable outcome in the running of bond market.With the pressure of the economic downturn,the problem of corporate bond default becomes more and more severe.By administrative measures to ensure rigid payment will distort the allocation of resources in the bond market,it doesn't mean the lack of investor protection shall do good to the economic development.It's imperative that the steady development requires the balance between convenient financing and investor protection through legal regulation of corporate bonds defaults.From the aspect of risk supervision,the thinking of rigid payment and decentralized supervision are the most common problems of regulatory reform.On the one hand,rigid payment thinking distorts the logic of breach of contract.On the other hand,the decentralization of regulatory power has led to the emergence of different regulatory bodies,issuance rules and the emergence of trading markets.The above two factors have led to regulatory failures in the face of default.Therefore,returning to the concept of market-based bond default management,building a relatively centralized regulatory system,improving information disclosure and credit rating are the keys in the prevention of default of bonds.From the aspect of default disposal,the system of bond trustee,independent negotiation,realization of security right,bankruptcy and debt service mechanism and litigation claim mechanism are the main ways of defaulting on domestic and foreign bonds at present.However,the aforementioned mechanism in our country needs further perfect.In addition,as an important part of the default protection of investors protection,the practice in our country is relatively scarce.The author creatively put forward a series of rationalization ideas such as the protection clause,the mechanism of fault liability,the report review mechanism and bond insurance.Based on the current situation of corporate bond market default in our country,combined with the advanced experience of developed foreign bond market,this paper analyzes the realistic difficulties of the risk supervision and the disposal of default.In the end,the author puts forward some solutions to this problem.Trying to build a defensive mechanism of default risk with judicial guidance as the premise,market-oriented self-regulation as the main body,and judicial relief as the guarantee.Hope that the above measures will help the development of China's bond market.