Case Study On The Bond Default Of Yongtai Energy

Recent years,With the rapidly development of Chinese bond market,bond defaults have gradually become the norm.In 2014,the default of the "11 Super Japanese Bonds" broke the rigid cashing situation on China,s bonds market,bond default events have frequently erupted since then,and the risks have intensified.The defaulting bodies of bonds have continued to spread and the amount of default has been increasing.Especially in 2018,bond defaults occurred intensively.Total market defaults amounted to 120.96 billion yuan,involving a total of 130 defaulted bonds,exceeding the total number in the 2014-2017 calendar year,which has caused a lot of impact on the market.Therefore,in combination with the development characteristics of China,s bond market,It is urgent to explore the causes and effects of bond defaults,and find ways to deal with default risks.yongtai Energy Co,Ltd is the only private listed company in China,s coal sector.The bond default occurred for the first time on July 5,2018,and the cross-protection clause was triggered,resulting in cross-default of more than ten other bonds,which caused a huge impact on the market.Therefore,this article uses Yongtai Energy Bonds default event as a case study,combing the precursor,process,disposal mode and credit rating adjustment of Yongtai Energy Bond after default.From Internal and external reasons,carries on the concrete analysis to the Yongtai energy bond default case,and described the impact on the subject after the bond default.Finally,put forward corresponding countermeasures and suggestions.It was found that Yongtai Energy's development strategy was too aggressive,and the sharp expansion of the map made the company need a lot of Fund supply,and Yongtai Energy,s own profitability and liquidity were unsatisfactory.It had to borrow a large amount to maintain the operation of the capital chain.In addition,the company itself did not pay attention to monitoring the security of the funds,and the rating agencies also failed to make timely risk warnings for rating adjustments.In the "lift new debt to repay old deb" model under the unsustainable situation,the risks of Yongtai Energy were quickly exposed,so the material bond default occurred,which caused severe impacts on the company itself,other related companies and investors.Finally from three perspectives of the company,the rating agency and the regulatory authority,putting forward targeted measures and suggestions for the bond default.First of all,Yongtai energy should quickly adjust its expansion strategy,become radical to steady,improving self-management and profitability,adjust the debt structure,to explore the monitoring and early warning mechanism for the company's own capital security.The rating agencies should improve the rating mechanism,improve their own impartiality,independence,authority.Regulatory authorities should improve the construction of laws and regulations,strengthen the supervision of bond issuance audit,and effectively monitor the behavior of rating agencies.Hoping to provide a certain reference value for other similar enterprises,and promote the healthy and stable development of the bond market in China.