What is a short-term financing bill? What do you mean by medium-term notes? The following is related knowledge, welcome to read and understand.

I. Brief Introduction of Short-term Financing Notes and Medium-term Notes

Short-term financing bonds refer to debt financing instruments issued by non-financial enterprises with legal personality in the inter-bank bond market, which promise to repay the principal and interest within 1 year.

Medium-term notes refer to debt financing instruments issued by non-financial enterprises with legal personality in stages in the inter-bank bond market as planned, and it is agreed to repay the principal and interest within a certain period of time. According to statistics, the term of recently issued medium-term notes ranges from 2 years to 5 years.

Basic points of issuing short-term financing bonds/medium-term notes;

1. The issuer of short-term financing bonds/medium-term notes is a legally established and legally existing non-financial enterprise legal person;

2. The target of issuance is institutional investors in the national inter-bank bond market, mainly including commercial banks, insurance companies, fund management companies, securities companies and other non-bank financial institutions;

3. The issue price is based on the market and determined by centralized placement with bookkeeping, which is mainly influenced by the bargaining power of the lead underwriter, the credit rating level of the enterprise, the scale of the enterprise and other factors;

4. The funds raised by the issuance of short-term financing bonds/medium-term notes by enterprises shall be used for the production and business activities of enterprises that meet the requirements of national laws, regulations and policies, and the specific use of the funds shall be clearly disclosed in the issuance documents. Enterprises should disclose in advance the changes in the use of funds raised during the issuance of short-term financing bills/medium-term notes;

5. The issuance scale shall not exceed 40% of the net assets of the enterprise.

Second, the issuance procedures

1. The issuer internally approves the issuance plan.

Short-term financing bonds/medium-term notes to be issued (hereinafter referred to as? Issuer? To examine and approve the resolution of issuing short-term short-term securities lending/medium-term notes according to the procedures stipulated in the articles of association of the enterprise or obtain the approval of the higher authorities.

2. The issuer determines the intermediary.

Intermediaries that need to be hired to issue short-term securities lending/medium-term notes include underwriters, law firms, accounting firms and credit rating companies. According to the provisions of the Association of Dealers, intermediaries handling short-term securities lending/medium-term notes business should be registered by the Association of Dealers and have the qualification to handle short-term securities lending/medium-term notes business.

The main duties of each intermediary agency are: the underwriter is responsible for underwriting and assisting the issuer in making the prospectus; Law firms need to issue legal opinions and lawyers' work reports; An audit report on the issuer's accounting statements for the last three years issued by an accounting firm; A credit rating report issued by a credit rating agency.

The issuer determines the intermediary agencies that issue short-term and medium-term bills and signs special contracts with them.

3. Prepare registration application documents.

Hold an intermediary coordination meeting to determine the work schedule. Intermediaries perform their duties, conduct due diligence, and enterprises actively cooperate. All intermediaries shall issue various documents within the time limit stipulated in the work plan and timetable.

4. Apply for registration.

Enterprises that issue short-term financing bonds and medium-term notes shall be registered with the dealers association.

The Association of Dealers establishes a registration committee. The registration committee shall perform its duties through the registration meeting. The registration meeting decides whether to accept the issuance registration.

The Registration Committee has an office, which is responsible for receiving and reviewing registration documents and arranging registration meetings.

The enterprise will deliver the registration documents to the office through the lead underwriter. Registration documents include:

(1) debt financing instrument registration report (attached with the resolution of the competent authority stipulated in the articles of association of the enterprise);

(2) Letter of recommendation from the lead underwriter and letter of commitment from relevant intermediaries;

(3) Documents to be disclosed when an enterprise issues debt financing instruments.

(4) Other documents that prove the truthfulness, accuracy, completeness and timely disclosure of the information of the enterprise and relevant intermediaries.

5. The Registration Committee of Dealers Association examines the application documents and decides whether to accept the registration.

The Registration Committee of Dealers Association examines the application documents through the meeting and decides whether to accept the registration or not. For enterprises that accept registration, the Dealers Association will issue a notice of acceptance of registration, and the registration period will be 2 years. Enterprises can issue debt financing instruments in one lump sum or in installments within the validity period of registration. Enterprises should complete the initial public offering within 2 months after registration. If the enterprise issues by stages, the subsequent issuance shall be filed with the Association of Dealers 2 working days in advance.

6. Delivery of issuance and raised funds.

The issuer publishes the prospectus of short-term financing bonds and the issuance announcement of short-term financing bonds on China Money Network and China Bond Information Network through the lead underwriter.

Short-term securities/medium-term notes are usually issued by bookkeeping and centralized placement. Members of the underwriting syndicate will pay the subscription money to the designated account. The amount issued by the lead underwriter in this period will be fully transferred to the account designated by the issuer after deducting the relevant underwriting fees.

7. Payment due

The issuer will repay the due principal and interest and fulfill the obligation of payment according to the provisions of the issuance documents.

Third, the advantages of short-term financing bills and medium-term bills financing

1, low financing cost.

The market-oriented pricing of interest rate is generally lower than the bank loan interest rate 1-2% in the same period, and it is not affected by the fluctuation of bank interest rate during the issuance period. If 500 million yuan is issued at one time, it can save millions of yuan in financing costs for the issuer's enterprises every year.

2. The issue threshold is lowered.

There are only three hard conditions for an enterprise to issue short-term financing bonds/medium-term notes: (1) it is a non-financial enterprise with legal person status registered in China; (2) The issue amount shall not exceed 40% of the net assets of the issuer's enterprise; (3) The raised funds are used for the production and operation activities of enterprises that meet the requirements of national laws, regulations and policies, and the specific use of the funds is clearly disclosed in the issuance documents. It is not mandatory to provide various forms of guarantees, and there is no requirement for profit level and return on net assets, which greatly reduces the entry threshold for direct financing of enterprises.

3. Financing is convenient and fast.

The adoption of the registration system makes the issuance and application procedures relatively simple, the preparation time is short, and the workload of enterprises is small, unlike corporate bonds and corporate bonds that need the approval of the CSRC, the National Development and Reform Commission and other departments.

Judging from the time spent, due to the relatively simple filing materials, it takes about 4 or 5 months to complete a complete distribution process.

The amount of funds raised at one time is very large.

The one-time application amount of short-term financing bonds/medium-term notes can be applied at a rate not exceeding 40% of the net assets of the enterprise (if the enterprise has issued other bonds and has not paid them off, the application amount will be deducted from the balance of bonds to be repaid). Most enterprises that issue short-term financing bonds are enterprise groups, with large net assets and large one-time financing amount. According to the statistics of 30 short-term and medium-term bills recently issued, the minimum one-time financing amount is 300 million yuan, and the maximum one-time financing amount can reach 654.38+0 billion yuan, which is unmatched by other financing methods.

5, can improve the credibility of the enterprise, enhance the corporate image.

Enterprises can successfully issue short-term financing bonds/medium-term notes, which shows investors' recognition of corporate credit, which will help to enhance the credibility and popularity of enterprises in the capital market and facilitate corporate refinancing in the future.

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