He has more than 18 years of experience in state-owned enterprise reform, management consulting and senior management, and has been active in the front line of state-owned enterprise reform all the year round, serving more than 100 customers in depth and executing more than 200 consulting projects.

The debt problem is indeed the most serious problem encountered by many financing platform companies at present. In some areas, many enterprises are caught in a vicious circle of debt, borrowing the new and returning the old, spending money to buy grain, and the pressure of rigid debt repayment is enormous. Among them, the debt situation of county-level companies is more severe, especially many city investment companies in the central and western regions, which are subject to local financial resources and local economic development level, and the debt problem is even greater.

For the city investment company, it is a rigid requirement for the city investment company to prevent and resolve the hidden debt risk, strictly abide by the company's debt bottom line and prevent and resolve the government debt risk, and it is also the unshirkable responsibility of the city investment company.

Then, when the city investment company is unable to repay its debts or is insolvent, can it implement bankruptcy reorganization or liquidation in accordance with the requirements of relevant laws and regulations to solve the debt problem? Borrowing the new and returning the old, spending money to buy grain, and the pressure of rigid debt repayment is enormous.

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The bankruptcy of the city investment company looks good, but it is difficult to do.

Legally speaking, financing platform companies such as City Investment Company, as corporate enterprises (rarely owned by the whole people), have no problem in adopting market-oriented bankruptcy reorganization or liquidation in accordance with relevant laws and regulations.

From a policy perspective, bankruptcy reorganization is also a way to solve the debt problem. As early as 20 18, the Guiding Opinions on Strengthening the Constraints of Assets and Liabilities of State-owned Enterprises clearly stated that "local government financing platform companies that are seriously insolvent and insolvent should be bankrupt, reorganized or liquidated according to law, and resolutely prevent' too big to fail' and resolutely prevent the accumulation of risks from forming systematic risks.

Moreover, all localities have a positive attitude towards bankruptcy reorganization or liquidation. For example, the documents on deepening the reform of budget management system issued by Jiangsu and Yunnan all mentioned that financing platform companies that have lost their solvency should go bankrupt, reorganize or liquidate according to law.

However, from the reality, the bankruptcy reorganization or liquidation of the city investment company can only be the last choice, not the best choice, and it is definitely a choice of "killing one thousand enemies and losing one thousand" and losing everything.

To sum up, there are three reasons:

First, the government credit of the local government and the corporate credit of the city investment company are actually deeply tied. For example, the credit rating of a city investment company depends on the local economic development level, fiscal revenue and other indicators. From this point of view, the bankruptcy reorganization or liquidation of the city investment company will not only damage or bankrupt the main credit of the city investment company itself, but also make the local government credit crisis, thus affecting the local financial environment and order, and the impact can be imagined. Therefore, the city investment company must not go bankrupt, reorganize or liquidate easily.

Second, no matter how the city investment company is reorganized, the debt repayment responsibility cannot be eliminated. To put it simply, it is probably not feasible to evade debts through bankruptcy, reorganization or liquidation. There are many local financing platform companies, but the actual controller is the local government. Obviously, from a legal point of view, no matter which company goes bankrupt, there will always be the subject of debt liability and the corresponding repayment methods and programs. Therefore, a company can go bankrupt, but on the whole, it is impossible for all financing platform companies and state-owned enterprises of a local government to go bankrupt completely or completely, and there must be a company to pay off debts.

Third, bankruptcy reorganization is a very inefficient way. Legally speaking, bankruptcy reorganization involves many links, heavy workload, long time, high cost and small income, which can not solve the actual debt problem well. Whether for shareholders, companies or creditors, it is not a win-win relationship, but a lose-win relationship, which is really the best policy. For the city investment company, bankruptcy and reorganization can not revitalize assets, invigorate operations, and then enhance the ability to repay loans. On the contrary, it is flat, wasting resources and assets.

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The Realistic Choice of Preventing and Resolving Debt Risks

At present, the debt problem of city investment company is very prominent. But in any case, the city investment company should face up to the reality and seek solutions under the unified leadership of the local government. It can neither be an ostrich nor lie flat. Among them, the most important thing is to keep the credit bottom line. At present, many non-standard products default, and even some companies have seriously affected the financial ecology and credit of the region. On the whole, city investment companies should safeguard the credit subject, properly handle repayment matters, try to avoid lawsuits and stability incidents, especially in banks, bond markets and capital markets, resolutely safeguard credit and prevent credit damage.

At present, the actual manifestations of debt problems of many city investment companies are unreasonable debt structure, unreasonable debt cost and unreasonable debt term. Too many non-standard and derivative products, too many short-term liabilities and too high comprehensive costs are unbearable for city investment companies with poor operating efficiency. Therefore, the city investment company needs to face these problems and find practical solutions.

How to deal with it? The principle is "exchange time for space, structure risks and adjust stocks incrementally".

First, trade time for space. Simply put, it is debt extension, borrowing new and returning old. Fully communicate with banks and other financial institutions, extend the repayment cycle as much as possible, adjust the repayment time, exchange time for space, reduce the short-term rigid debt repayment pressure, and use short-term funds more for development through debt extension or borrowing new ones to repay old ones. At the same time, we should pay special attention to the debt maturity in new financing, clarify the financing strategy, try to avoid the phenomenon of short-term loans and long-term investments, and try to reduce the proportion of short-term financing.

Second, take structural risks. To put it simply, do what you can, don't drink poison to quench your thirst, grasp the debt structure, minimize the proportion of non-standard and derivative financing, match the appropriate financing method according to the project situation, scientifically calculate the financing cost, resolutely avoid high-cost financing beyond the company's repayment ability, optimize the debt structure, reduce the comprehensive cost, and reduce the debt cost and debt risk through structural adjustment.

Third, adjust the stock incrementally. The existing debt problem, with existing companies, existing businesses and existing assets, may not be solved in a short time. Therefore, short-term, medium-term and long-term methods should be combined in debt treatment. On the one hand, it is necessary to solve existing debts in an orderly manner; On the other hand, we should increase financing, gradually enhance the repayment ability of the company with new financing, and ensure that no major debt default occurs. Therefore, it is necessary to strengthen credit and increase financing capacity by setting up new companies and adding new market-oriented projects, and adjust stock debts through incremental financing, thus gradually forming a virtuous circle.

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The real way to completely solve the debt crisis

Short-term control or even partial resolution of debt risk can be achieved by various means. But the real solution to the debt crisis of the city investment company should focus on the company itself.

In other words, the company should keep fit, have the ability to make blood, and have enough credit and solvency, which is the real solution to the debt problem of the city investment company. Obviously, this requires city investment companies to accelerate market-oriented reforms and promote their own transformation and upgrading.

The transformation and upgrading of city investment companies must require local governments to consider the overall situation and coordinate government debt and corporate debt, government resources and corporate resources, government deployment and corporate goals.

First, government debt and corporate debt. Local governments must co-ordinate government debts and corporate debts, and give clear support to the handling of hidden debts and public welfare assets of city investment companies. The hidden debts and public welfare assets of city investment companies are mostly facts, which is a great burden and pressure for the company's development. Therefore, in the market-oriented development of city investment companies, local governments should provide practical help for the orderly digestion of hidden debts and the orderly disposal and replacement of public welfare assets, so that the companies can go into battle lightly and develop rapidly.

Second, stock debt and incremental financing. City investment companies should vigorously promote restructuring and integration. The debt problem should be viewed from the perspective of development. We should not simply deal with the existing debt, but should combine debt, financing and development, especially to maintain or even improve the existing financing capacity. Therefore, it is necessary to reorganize the company structure with financing subject and financing credit as the core, create a new company structure, cancel shell companies, make the financing subject real, and operate in the way of "old methods for old companies, new methods for new companies" to open up the space for company development.

Third, capital and commerce. The focus of the city investment company should be the project. In other words, the essence of debt-to-equity swap is to have manageable and profitable projects. Therefore, with the support of local governments, city investment companies should integrate all kinds of assets, clarify their own positioning, vigorously adjust their business structure, promote mergers and acquisitions, integrate similar businesses, vigorously expand market-oriented businesses, take projects as the starting point, earnestly strengthen project planning, investment and financing, construction and operation management, reconstruct investment and financing models, and then complete the reshaping of their hematopoietic functions.