Impact Of Participation In Financial Institutions On The Financing Constraints Of Listed Companies

In recent years,with the continuous promotion of China’s financial market reform,the entry threshold of financial industry has been relaxed,and many companies have chosen to participate in the financial field by means of equity participation in financial institutions,using the mode of industry-financing combination to realize industrial transformation in order to better meet their own development needs.Under the environment that the state supports companies to try to combine industry and finance and the listed companies in China are generally facing financing difficulties,it is very important to study how the participation in financial institutions will affect the financing constraints of listed companies.If the listed companies can obtain more capital from outside to alleviate their own financing constraints after participating in financial institutions,if such influence does exist,it will provide a new solution for many companies facing financing difficulties.Whether the participation of listed companies in financial institutions can alleviate their own financing constraints,most of the previous literature focuses on the relationship between corporate financing constraints and the external economic environment and monetary policy,but there is a lack of literature on how to alleviate financing constraints from the perspective of participation in financial institutions.In the existing literature on equity participation in financial institutions,most of the literature studies equity participation in a specific type of financial institutions,such as banks,brokerage firms,insurance,etc.In this paper,we expand the research object to all financial institutions as the continuous development and improvement of China’s financial market,companies are no longer limited to equity participation in a specific type of financial institutions.In the theoretical part,this paper starts from the theory of financing constraint and carries out theoretical analysis on how participation in financial institutions can alleviate the financing constraint of listed companies,and in the empirical part,uses the real data of listed companies to build a model for further testing.In this paper,the data of listed companies are selected from Guotaian database and wind database.Based on the cash-cash flow sensitivity coefficient model,the econometric model of this paper is established,and the fixed-effect model is used for multiple regression analysis to find out whether the listed companies can reduce their financing constraints after participating in financial institutions.In addition,this paper adds companies of different sizes,companies of different nature,and companies with or without financial institution backgrounds of directors and supervisors as moderating variables for heterogeneity analysis,and analyzes the status of different types of companies in alleviating financing constraints after participating in financial institutions to supplement and improve the relevant literature.On this basis,through theoretical and empirical analysis,this paper draws the following conclusions: firstly,listed companies can indeed alleviate their financing constraints after participating in financial institutions.Secondly,the participation of small-sized companies in financial institutions can alleviate their financing constraints better than the participation of large-sized companies in financial institutions;the participation of non-state companies in financial institutions can alleviate their financing constraints better than the participation of state-owned companies in financial institutions;the participation of companies whose directors and supervisors have financial institutions’ backgrounds can alleviate their financing constraints better than the participation of companies whose directors and supervisors do not have financial institutions’ backgrounds.According to the findings of the study,this paper makes the following suggestions to the company and the government respectively: for the company,first of all,the listed company’s participation in financial institutions can indeed alleviate its own financing constraints,can be used as a way to alleviate financing constraints,but it also depends on its own actual situation,and should not blindly carry out the combination of industry and finance.In addition,the company should attract financial talents and build a financial network to relieve its own financing constraint.For the government,first of all,the government should encourage enterprises to take the initiative to explore the combination of industry and finance.Secondly,the government should strengthen the supervision of the financial market and create a good market environment to promote the healthy development of micro enterprises.