The Impact Of Family Control On Loan Collateral

With the continuous development of China's market economy,the private economy,dominated by family-owned companies,has gradually become an important role on China's economic stage and has promoted the enrichment and improvement of China's economic structure.It is an important part of the market.China's research in the field of family businesses is still in the stage of development.There are still many relevant issues worthy of research and exploration.This paper starts with the pyramid structure of the family-owned company,the separation of the two powers,and the agency cost between the company and the bank.The study is based on the current situation of the market in China,the policy system,and the development and characteristics of the family business.On the one hand,China's previous protection of investors was not perfect,the public debt market was not well developed,and most of the company's borrowing sources were banks;on the other hand,although the process of marketization of interest rates in China continued to advance,the degree of marketization had increased,but the macroeconomic Under the deteriorating conditions,banks are still more inclined to lend funds to state-owned enterprises with greater risk tolerance and stability.This imposes certain restrictions on the loans of family-owned companies,and therefore it has just transformed into a market-oriented loan market.It is more appropriate to use collateral as a guarantee requirement and measure for the cost of debt.In addition,the existence of the separation of powers has led to the triple agency problem of family firms.At present,there are many opinions about agent conflict theory in the world.However,the research on agent conflict in family firms mainlyhas the following two viewpoints: one is “faith.Theory,that family business is a long-term investor,in order to maintain corporate survival,maintain family reputation,and establish long-term trust and cooperation with creditors,agent conflicts will be eased;one is the "defense point of view",that the family business over-family Control and family management have exacerbated the agency conflict between shareholders and creditors,making it possible to extract private interests,and the encroachment motives and behaviors have led to an increase in credit risk and,as a result,higher debt agency costs.This paper obtains raw data through the CSMAR database,and obtains data samples of private listed companies through calculation,screening,and processing.Empirical analysis is performed using random effects model,GMM model,and Logit model,and it is concluded that the existence of family control will lead to the bank of the company.The proportion of mortgages in loans increased.When a family company has a relatively large degree of separation of powers,family members participate in management,and the company has existing senior management personnel,banks are more inclined to require companies to provide mortgage guarantees to obtain loans instead of issuing credit loans;When the major shareholders are located in provinces where the credit market is more competitive,the requirements for bank mortgage loans will be relatively relaxed.In general,the family firm's aggressive opportunities lead to an increase in its credit risk,and banks' credit requirements for their mortgages will be higher than for non-family controlled companies.Unlike most methods for comparing family-owned companies with state-owned enterprises,this paper studies private listed companies and concludes that family control and other factors affect private companies' mortgage loans.It points out the current situation in China and proposes reasonable conditions.Feasibility policyrecommendations.Enriched the relevant literature on family agency and creditor agency issues.