The Impact of Short-term Loans on Long-term In-vestments on Corporate Financial Risk: An Empiri-cal Evidence Based on Listed Real Estate Companies in A-share Market

Haiying Wang

doi:10.63313/EBM.9096

Authors

Haiying Wang Anhui University of Technology, Ma'anshan, 243000, China Author

DOI:

https://doi.org/10.63313/EBM.9096

Keywords:

Short-term loans for long-term investments, mismatch between investment and financing terms, risks of real estate enterprises, excessive indebtedness

Abstract

Taking Chinese real estate enterprises listed on the A-share market from 2005 to 2022 as samples, this paper empirically examines the impact of "short-term bor-rowing for long-term investment" on the financial risks of real estate enterprises by using the two-way fixed effects model and the mediating effect model. The re-sults show that "short-term borrowing for long-term investment" intensifies the financial risks of real estate enterprises, and it mainly exerts negative impacts on the finance of real estate enterprises by increasing excessive debt, aggravating debt costs, and reducing profitability. This study is helpful to clarify the causes of risk agglomeration in China's real estate enterprises and provides references for the risk control and investment-financing decisions of real estate enterprises.

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