Letter Behind The Default Of Bond Market

As bond defaults normalize, how to defuse market risks has become a key proposition.

This month, there are 4 companies of Dongxu photoelectric, GUI bird, gang Tai holdings and ST Jin Gui on the list of bond defaults, and they are all listed companies. As of November 27th, 154 bonds have been defaulted this year, involving a total of 118 billion 751 million yuan.

But it is worth noting that the overdue events in the bond market have also become more complicated, and some issuers' payment problems have not even been presented in the data.

This reporter noted that recently many companies did not announce the debt in advance after the issuance of the bonds, but chose to eliminate the impact through "OTC payment". These companies often play tricks on information disclosure, and only mention a portion of the funds in the cashing notice of the maturity date of the bonds, but do not indicate that the remaining part has been breaching the contract, thereby evading the announcement of the breach of contract.

In the past, we laughed and waited until the company confirmed the breach of contract. Rating firm began to cut down the rating of "cliff type". The mechanism is lagging behind and the credit rating is nominal. Today, some of the issuers in the market have been "hiding" after default, to avoid "official declaration" breach of contract, or even downgrade, in order to restore the phenomenon of peace.

Just like the "16 day wide 01" issued by Tianguang Zhong Mao recently, when the maturity of the bonds expired, the company only indicated that it had paid the bonds payable to the debenture holders who did not apply for the registration. However, Tianguang Zhong Mao did not pay the principal and interest of the debenture holders who had applied for resale registration, which constituted a breach of contract. This is not explained in the announcement.

Moreover, when the "16 Yihua 01" expires, the publisher has applied for payment by the China Securities Depository and Clearing Co., Ltd., the Shenzhen branch, for the payment of the interest portion of the current bond, but the principal part of the repurchase will be paid by the company itself.

And the OTC payment means the next "zero" information disclosure. You know, two bonds are publicly issued corporate bonds.

In fact, the repeated payment crisis has brought challenges to the rule of faith in the capital market.

In the "Regulations on the issuance and trading of corporate bonds", it is clearly stipulated that the issuers of public issuance of corporate bonds should promptly disclose major events that may affect their solvency or bond prices during the duration of the bonds. The major issues include the default of the issuer in failing to repay the debts due.

Although from the issuer's point of view, the choice of OTC payment to avoid breach of contract notice may be a "helplessness". Because under the current market chain, once the breach of contract is exposed, the image of the enterprise will be greatly reduced and directly affect the subsequent financing.

Earlier news also pointed out that in the face of the frequent occurrence of credit default, the exchange is planning a grace period for breach of contract from the perspective of rescuing issuers, seeking ways to defuse risks.

But this system is not clear at the moment. When the system is not clear, there are many cases that challenge the existing rules, which is also unfavorable to the development of the future market.

There is no doubt that information disclosure should be the core of the capital market. At present, the market's demand for openness and transparency is very urgent. Nowadays, some issuers frequently choose to pay off the field and play tricks on the letter, so the market can not get real information, and can not objectively evaluate it.

With the increase of such non-standard phenomena, although it can alleviate the pressure of issuers to some extent and reduce the number of defaults to beautify the market environment, how can we know that the crisis accumulated over a long period of time will not be concentrated again?