Are Participants in Bond Market Concerned about the Quality of Information Disclosure: Evidence from Chinese Listed Companies

Abstract

High quality of information disclosure can reduce the information asymmetry, which is very important to the effective operation of the capital market. This article studies whether participants in bond market are concerned about the quality of information disclosure based on a sample of listed companies in China's bond market from 2007 to 2013. We find that there is no significant relationship between information disclosure quality and credit rating, indicating the credit rating agencies are not concerned about information disclosure quality. However, we find information disclosure quality can significantly reduce the bond financing cost, which indicates that bond investors are concerned about information disclosure quality.