Study On The Risk And Precaution Of Geo-Jade Petroleum Corporation Equity Pledge

In recent years,the financing mode of equity pledge has been favored by more and more listed companies because of its advantages of simple procedure,low cost and few restriction conditions.In the 2016,the scale of equity pledge in the A-share market peaked,the proportion of equity pledge of enterprises is more and more high,and the risk is increasingly revealed.With the advancement of China's deleveraging economic policy,the tightening of liquidity and the strengthening of supervision have led some high-proportion pledged enterprises to face a crisis of detonation,which has brought some panic to the capital market.This article will mainly study the major shareholders of these listed enterprises to choose Equity pledge as the main financing means will face the risk,as well as the risk prevention measures taken.Starting with the relevant literatures on equity pledge financing at home and abroad,this paper focuses on combing and analyzing the relevant data of the risk and response of equity pledge financing,and summarizes the risks arising from the pledge of equity by the major shareholders of listed companies.Taking Geo-Jade Petroleum Corporation as the case object,this paper makes an in-depth analysis of the risks faced by the major Geo-Jade Petroleum Corporation shareholders in the financing of equity pledge and the countermeasures taken as the 2014-2018 starting point,which is supported by the data of the first equity pledge in the A-share market.Geo-Jade Petroleum Corporation equity pledge ratio of up to 99.96%,its main motivation is to rely on domestic positive policies and the cyclical trend of oil price rise,through the continuous development of overseas oil and gas investment,in the industry occupies a place.After the equity pledge financing of Geo-Jade Petroleum Corporation,it mainly faces the moral hazard of the interest encroachment of the major shareholders,the risk of closing the position due to the fluctuation of the stock price,and the risk of control transfer caused by the high proportion of equity pledge.Geo-Jade Petroleum Corporation should deal with moral hazard by strengthening internal control and corporate governance,using stock suspension and additional funds to deal with the risk of closing positions,and using the method of re-pledge to deal with the risk of control transfer.This paper has certain research significance for the risks faced by the major shareholders of listed companies in carrying out equity pledge,as well as the countermeasures taken to prevent the risk.