Academic Journal of Business & Management, 2025, 7(11); doi: 10.25236/AJBM.2025.071117.
Yueyue Zhu
Department of Accounting, Lanzhou University of Technology, Lanzhou City, Gansu Province, China
In recent years, frequent bond defaults in China's bond market have triggered a series of chain reactions within the industry. Bond defaults not only precipitate corporate liquidity crises but also undermine the effective functioning of financial markets, thereby infringing upon investors' legitimate rights and interests. Consequently, identifying and preventing bond defaults has become a focal point for enterprises. This paper identifies risks in corporate bond defaults by combing through their causes and analysing the case of Company B's bond default. The introduction of the ‘three red lines’ policy signifies China's property market has entered a phase of deleveraging and high-quality development. With financing channels constrained, the sector faces deepening adjustments and accumulating risks. Company B has for the first time acknowledged its inability to repay maturing debts, thereby establishing its default as a fait accompli; subsequently, the company has pivoted its focus towards debt restructuring in pursuit of a viable solution. To mitigate corporate bond default risks, this paper proposes measures including strengthening internal corporate governance to enhance decision-making efficiency; proactively disclosing information to reduce capital costs; and establishing diversified restructuring plans. These steps aim to prevent liquidation, facilitate corporate revitalisation, and thereby safeguard financial market stability.
Bond Default; Risk Identification; Real Estate Enterprises
Yueyue Zhu. Research on Identifying and Addressing Corporate Bond Default Risks: The Case of Company B. Academic Journal of Business & Management (2025), Vol. 7, Issue 11: 129-133. https://doi.org/10.25236/AJBM.2025.071117.
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