Case Study On Bond Default Of Taihe Group

The bond market is an important part of the domestic financial market and an important financing channel for real estate enterprises.In recent years,Chinese credit bond market has developed vigorously and has now become the third largest bond market in the world.Before 2014,due to the existence of the "rigid payment" phenomenon in the bond market,no default problem occurred for a long time.As the economy enters the "new normal" and the economic growth rate shifts to face downward pressure,the problem of credit risk in the bond market gradually emerges.The default of "11 Super Sun Bond" broke the rigid payment of the bond market,after which defaults occurred frequently and the scale of defaults continued to expand,most of the defaulted bonds with high credit ratings,and the defaulted subjects were mostly gathered in private enterprises,which aggravated investors’ fear of the overall default risk of the market.All these phenomena have seriously threatened the healthy and orderly progress of the bond market.In this context,this paper selects Taihe Group,a real estate company with frequent defaults recently,as the research object.Firstly,the relevant literature on the influencing factors,risk measurement and risk prevention of bond default is summarized and sorted,and the basic situation of Taihe Group,bond issuance,default history and follow-up disposal are introduced,which lays the foundation for the following case analysis;secondly,Combined with cases,analyze the causes of default from the macro-environmental level,industry level,and company internal level,and empirically analyze the influencing factors of bond default through principal component analysis and logit model.Then based on Z model,make a risk calculation and compare the calculation result with the rating result of the third-party rating agency.Finally,from the perspectives of Taihe Group,regulators,credit ratings and investors,provide advice on how to prevent bond defaults.The main conclusions of this paper are as follows: First,the macroeconomic downturn,the tightening of the real estate industry policy regulation and the deterioration of the company’s operating conditions are all important factors for bond defaults.Second,through the principal component analysis method and logit model to empirically analyze the influencing factors of Taihe Group’s bond default,it is found that Taihe Group’s operating ability,development ability and solvency have a significant impact on the bond default.Third,from the perspective of the Z-value of the comprehensive financial index,it gave an early warning of risk changes.When the Z-value begins to be less than the critical value,attention should be paid to bond risks.The comparison found that there are inflated and lagging problems in the rating results of third-party rating agencies,so it is very important to improve the credit rating method.