Convertible bonds were first introduced in China in 1998. Their popularity has risen in the past decades through various domestic regulatory reforms, as more and more companies came to recognize their advantages over conventional bond or equity issuances as ways to raise capital. In this paper, we study the role of convertible bonds in Chinese A-share listed companies’ decision to refinance, using data from 1999 to 2018. First, we find that firms with high information asymmetry tend to issue more convertible bonds than equities to mitigate financing cost, especially under the “Regulation of Restraining Non-public Issuance of Shares (NPIS)” launched in 2017, a regulation that retrains listed companies to issue shares non-publicly. Second, the introduction of “Breaking Rigid Redemption” policy, which breaks the custom of using rigid redemption clauses when financial institutes issue corporate bonds and asset management products, effectively promoted interest rate marketization in China and as a result, companies with a strong tendency to shift risks began to issue convertible bonds to reduce issuing cost after 2017. Third, regulatory requirements on the qualifications for companies played important roles in their refinancing choices. Lastly, we also find that SOEs in China are overall less sensitive to risk-shifting and information asymmetry, given their ample loan resources compared with non-SOEs. Our findings delineate the behaviors of Chinese A-share listed companies in their refinancing and explain the sudden surge in convertible bonds issuance since 2017.