What are the solutions to corporate bond default?

1. What are the solutions to corporate bond default? The Measures for the Administration of Issuance and Trading of Corporate Bonds stipulates: "When issuing corporate bonds, the issuer shall employ a bond trustee for the bondholders and conclude a bond trustee management agreement; During the existence of bonds, the bond trustee shall safeguard the interests of bondholders in accordance with regulations or agreements. " 1. Self-negotiation: Generally speaking, if the creditor expects that the operating conditions of the debtor's enterprise are only temporarily in trouble, the cost of resorting to justice is relatively high, and at the same time, in the absence of credit enhancement measures, judicial treatment does not necessarily bring the advantage of disposal. Under various trade-offs, the creditor tends to choose the way of self-negotiation. The debtor may reach an agreement with the creditor on subsequent debt repayment arrangements, including postponing or making specific debt restructuring plans. 2. Apply for arbitration: In practice, some private debt holders adopt this method. Generally speaking, arbitration is faster than litigation, but the fees charged by the arbitration commission are higher than the legal fees charged by the court. 3. Default creditor's rights: In the default creditor's rights, the creditor expects the debtor's business situation to deteriorate and has a continuous trend, but the debtor still has a certain solvency when the debt expires, and cannot meet the bankruptcy application conditions such as insolvency. Therefore, the creditor can file a claim for breach of contract with the creditor and ask the debtor to pay the principal and interest within a time limit, or ask the debtor to bear liquidated damages, damages, overdue interest, etc. 4. Bankruptcy procedure: If the negotiation fails and the debtor is insolvent, the bondholders can only provide the last resort of bankruptcy procedure. In the way of bankruptcy proceedings, both debtors and creditors can file bankruptcy applications. Usually, creditors file bankruptcy applications and eventually enter bankruptcy proceedings, mostly secured creditors. This is mainly because such creditors are at the front end of the property settlement order, with stronger voice and superior repayment rate. According to the bankruptcy procedure, bondholders can apply for reorganization or bankruptcy liquidation, or participate in the reconciliation procedure applied by debtors. 2. What kinds of new corporate bonds are there? According to the Listing Rules of Corporate Bonds of Shanghai Stock Exchange (revised 20 15) issued by Shanghai Stock Exchange, newly-added corporate bonds are divided into the following three categories: 1, corporate bonds for public investors and qualified investors, namely "publicly issued" bonds. This kind of corporate bonds must meet the situation that there is no debt default or delayed payment of principal and interest in the last three years, the average annual distributable profit realized in the last three fiscal years is not less than 1.5 times of the annual interest of the bonds, and the credit rating of the bonds must reach AAA. In other words, public investors who can't meet the requirements of qualified investors (described below) can only choose AAA-level varieties if they want to invest in new corporate bonds. AAA is the highest rating of domestic bonds, which shows that the regulatory authorities have made great efforts to protect the funds of public investors and avoid risks. It should be noted that if the debt rating of "Dagong Sale" bonds is lowered to below AAA during its existence, public investors will not be allowed to continue buying, and those already held can be sold or held at maturity. If the debt of a "small public offering" bond is raised to AAA level during its existence, but it cannot be upgraded to a "large public offering" bond, public investors will still be unable to participate in the transaction. 2. Corporate bonds only for qualified investors, that is, "small public offering" bonds, cannot be invested by ordinary public investors, so the biggest difference between small public offering bonds and public offering bonds is that the credit rating of bonds is below AAA, that is, "AA", "AA-" and other bonds with lower ratings. 3. Non-public issuance of corporate bonds Non-public issuance of corporate bonds, that is, private debt, is characterized by the fact that except for qualified institutional investors, the number of private debt investors shall not exceed 200 at a time, and the exchange that exceeds 200 will not confirm the transfer. Investors should not only meet the requirements of qualified institutional investors of the exchange, but also consider the risks such as limited transfer scope and limited liquidity. In some cases, the company's bond default is not caused unilaterally and intentionally. This is because the company was eliminated in the market competition environment and its own operating conditions continued to deteriorate. The bond is about to expire, but the company can't accept the principal and interest. In fact, it is not necessarily the company that files for bankruptcy. Holders of corporate bonds can also apply for bankruptcy proceedings.