Research On The Impact Of Credit Ratings On The Corporate Bond Issuance Pricing In China

In order to deepen financial supply-side structural reforms and enhance the ability of financial services to the real economy,the relevant central authorities have been encouraging the construction and improvement of multi-level capital markets.As a key component of the capital market,the bond market is an important channel for the government to implement macroeconomic regulation and control,and it is also the main source of funds for enterprises operations.In 2015,the CSRC issued the “Administrative Measures on the Issuance and Transaction of Corporate Bonds”,and the corporate bond market has since entered a stage of rapid development.In recent years,the rigid redemption of the bond market has gradually been broken,and corporate bond default incidents have occurred frequently.The importance of preventing and resolving the credit risk of corporate bonds has become increasingly prominent.Credit ratings can effectively alleviate the information asymmetry between investors and debt issuers,and pass incremental information to the market,thereby restricting the behavior of corporate entities and protecting the interests of investors.In this context,it is of great significance to study the impact of credit ratings on corporate bond pricing.This article introduces the concept of corporate bonds by introducing the product structure of China's bond market,describes the development history and current situation of the corporate bond market,and statistically analyzes the default of corporate bonds by the end of 2019.Then,this article introduces the concept of credit rating and the development of the industry,referring to some problems existing in the credit rating industry today,which are also important factors that restrict the quality of ratings.Next,the article elaborates the method,framework and model of credit rating of corporate bonds in China,which focuses on comparing the different rating factors of domestic rating agencies.From the perspective of economics,this paper analyzes the mechanism of credit rating on corporate bond issuance pricing.This paper selects corporate bonds issued publicly from January 1,2012 to December 31,2019 as a research sample,and draws on the research experience of domestic and foreign scholars to analyze the impact of credit ratings on corporate bond issuance pricing using a multiple linear regression model.In empirical research,in addition to examining the impact of key variable credit ratings,the model is also set up to take into account factors such as bond issue size and maturity,market indices and volatility,special terms,and the nature of the issuer's enterprise,which controls the effects of years and industries.In the case of significant regression results,this article divides the sample data according to the rating quality of rating agencies,further verifying the credibility of domestic credit rating agencies.Through a combination of qualitative and quantitative research,this paper concludes that credit ratings have a significant impact on the pricing of corporate bond issuance.Increasing debt ratings and subject ratings can reduce the issue cost of corporate bonds.The impact of debt rating on corporate bond issuance pricing is greater than the subject rating.In addition,despite the differences in the rating quality of domestic credit rating agencies,those agencies that do not have such good ratings still have a certain degree of market credibility.Finally,in view of the existing problems in the credit rating industry,this article puts forward some constructive suggestions.