Research On The Implementation And Consequences Of Marketized Debt-to-equity

At present,the leverage ratio of Chinese enterprises is too high,and the debt growth rate is too fast,which may lead to large-scale debt default.In view of the successful resolution of similar problems in the 1990s,the government proposed a market-oriented debt-to-equity swap policy,namely market-based debt-to-equity swaps.The "Guiding Opinions on Converting Equity from Marketized Banks" issued in October 2016 means the opening of a new round of debt-to-equity swaps.This opinion aims to guide and promote the implementation of debt-to-equity swaps by banks and enterprises in accordance with the principles of marketization and legalization,to reduce the non-performing asset ratio of banks and the asset-liability ratio of enterprises,so that enterprises can temporarily get out of financial difficulties and focus on long-term development and prevention.Various financial risks.The more important significance is that through this opportunity,banks and enterprises will innovate on the basis of no burden,accelerate the pace of reform,and achieve a win-win situation.This paper selects Yunnan Tin Group(Holdings)Co.,Ltd.(hereinafter referred to as "Yunxi Group")as the case study object.Since it is the first local state-owned enterprise to implement debt-to-equity swap after the promulgation,its successful implementation will give Subsequent debt-to-equity swaps provide great guidance.This article stands at the perspective of creditors,debtors and investors,taking Yunxi Group as an example to study the implementation and consequences of market-based debt-to-equity swaps.The article firstly explains the difference between the two rounds of debt-to-equity swaps,which shows that the new round of debt-to-equity swaps is not a simple copy,but a policy that emerged in the new era,and elaborated a new round of debt-to-equity swaps.The impact on stakeholders,and the problems and risks they may encounter,and the experience of foreign debt-to-equity swaps,laid a good theoretical foundation for the case study below.Through the case analysis of Yunxi Group,it is found that its mode of operation does have something to learn from,such as its degree of marketization and the way of cross-border debt swap.In addition,debt-to-equity swaps have indeed played a positive role in stakeholders to a certain extent.However,it also points out the risks and problems that the Yunxi Group and subsequent debt-to-equity companies may face in the process.And put forward corresponding countermeasures,in order to provide them with reference,which is conducive to promoting enterprises to reduce leverage,improve profitability and improve corporate governance.It can also reduce some hidden financial risks.