Analyst Identifies 3 Types of Credit With High Default Risk

JRJ: 违约债券都长啥样?三类特征发行人需加以关注
In general, although the policy of “wide” credit in the third quarter is frequent, it is limited by the strength of credit expansion in the bank table, the dredge of other expansion channels, and the degree of improvement of market risk appetite. The specific landing effect remains to be seen. Therefore, the control of credit risk must not be taken lightly. Through the above brief review, we summarize the development path of credit qualification deterioration until the default as shown in Figure 3. We believe that issuers with the following characteristics should pay attention to it. First, due to weak business or industry position, weak bargaining power, etc., the ability to liquidate cash is weak, or because of related transactions, such as the use of the company's own liquidity, resulting in greater pressure on working capital; Second, internal cash flow is weak, but the company relying on external financing to continue to expand the scale of business, resulting in the continuous expansion of debt scale; Third, the debt structure is unreasonable, the maturity of asset and liability maturity is serious, resulting in debt repayment extremely reliant on refinancing.

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