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Title:	Leverage and Capital Structure Determinants of Chinese Listed Companies
Authors:	ADB; Ferrarini, Benno; Hinojales, Marthe; Scaramozzino, Pasquale
Issue Date:	Jan-2017
Description:	This paper assesses the financial fragility of the Chinese economy by looking at risk factors in the corporate nonfinancial sector. Total debt in the People’s Republic of China has increased significantly in recent years, mostly on account of nonfinancial corporate debt. Earning and the financial performance of corporate firms have weakened, and so has the asset quality of the financial sector. In this paper, quantile regressions are applied to a rich dataset of Chinese listed companies contained in Standard & Poor’s IQ Capital database. Authors find higher sensitivity over time of corporate leverage to some of its key determinants, particularly for firms at the upper margin of the distribution. In particular, profitability increasingly acts as a curb on corporate leverage. At a time of falling profitability across the Chinese nonfinancial corporate sector, this eases the brake on leverage and may contribute to its continuing increase.
URI:	https://www.adb.org/publications/leverage-capital-structure-chinese-listed-companies https://elibrary.tucl.edu.np/handle/123456789/5268
ISBN:	N/A N/A
ISSN:	23136537 23136545
Country:	China People's Republic of
Appears in Collections:	ADB Collections

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