Analysis On The Impact Of Market-Oriented Bank Debt-to-Equity Swap In Wuhan Iron And Steel Group

With the promotion of supply-side structural reform and de-leveraging and de-capacity policy,China launched the second round of bank-led market-oriented debt-to-equity swap in 2016,aiming at cooperating with non-financial enterprises to de-leverage and promote the reform of state-owned enterprises.The new round of debt-to-equity swap emphasizes the principle of market-oriented,which helps enterprises to reduce the ratio of assets to liabilities,enhance their operating conditions and improve their management structure.On this basis,it improves the unreasonable debt structure formed in China's economic development and reduces the potential risks in economic operation,thus speeding up the transformation and upgrading of China's economy.Firstly,this paper combs the viewpoints of debt-to-equity swap research at home and abroad,and then summarizes the relevant literature.On this basis,through the analysis of China's current economic situation,from a realistic level to explain China's current debt-to-equity swap facing the realistic needs,and then compare and summarize the differences between the last and the current debt-to-equity swap.Then,this paper chooses the first landing project of market-oriented deleveraging of central enterprises in the current round of market-oriented debt-to-equity swap,China Construction Bank and WISCO Group as case studies,and grasps the impact of debt-to-equity swap from the micro level.Firstly,it briefly introduces the basic situation of WISCO Group and the specific mode of debt-to-equity swap.Then,according to the participants of debt-to-equity swap,it analyses the conditions of debt-to-equity swap in WISCO Group from different angles,and demonstrates the necessity of debt-to-equity swap in WISCO Group.Then from the perspective of WISCO Group itself,this paper analyses the reasons for the implementation of debt-to-equity swap,and then from the aspects of capital structure,solvency,operation and corporate governance,it deeply analyses the impact on enterprises;as the first-place debt-to-equity swap project,it also analyses the impact of the debt-to-equity swap on banks from the perspective of CCB.The successful landing of the debt-to-equity swap project of WISCO Group has opened the prelude of the current round of debt-to-equity swap,and the adopted model has also been used for reference by the follow-up debt-to-equity swap project.At the same time,because the market-oriented debt-to-equity swap has just started,the related risks have not been fully exposed.This paper combines the problems in the previous round of debt-to-equity swap and the exploration of this round of debt-to-equity swap,and puts forward relevant suggestions,hoping to bring some inspiration to this round of debt-to-equity swap.