A Research into Convertible Bonds Financing of Chinese Listed Companies——From the Perspective of Contract Design

Convertible bond is a hybrid financing tool with both stock property and bond property.The design of the articles of the contracts of convertible bonds can make them predisposed to stock property or bond property.The authors analyze the main articles of the convertible bonds issued by the listed companies of our country in the years between 2002 and 2008 such as their maturity,interest rates,conversion duration,conversion price,conversion premium rate,call provision,put provision and special downward revision provision,and find that the majority of convertible bonds are biased to stock property,which is attributable to both the issuers’ subjective factors and the objective factors of supervising authorities’ institutional restriction.