The Determinants Of Corporate Debt Ownership Structure
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Author | : Shane A. Johnson |
Publisher | : |
Total Pages | : |
Release | : 2011 |
Genre | : |
ISBN | : |
I examine the relation between corporate debt ownership structure and several firm characteristics suggested by recent theory. The results demonstrate the importance of monitoring and information costs, the likelihood and costs of inefficient liquidation, and borrowers' incentives in affecting firms' debt source preferences. Several theoretical predictions receive support, while others do not. The results also suggest important differences between bank and private nonbank debt, which contrasts with most theoretical models. Additionally, I find evidence of systematic use of bank debt by firms with access to public debt, suggesting the benefits attributed to bank debt in theoretical models remain important after firms gain access to public debt markets. Although different lenders appear to have different maturity preferences, the results also suggest debt maturity and debt ownership decisions may be separable.
Author | : Antonios Antoniou |
Publisher | : |
Total Pages | : 38 |
Release | : 2004 |
Genre | : |
ISBN | : |
This paper offers a comparative analysis of the determinants of the corporate debt ownership structure in a bank-oriented economy (Germany) and market-oriented economy (the UK). Using GMM estimators, we control for the problems of endogeneity, heteroscedasticity, normality, simultaneity and measurement errors that are common in firm-level panel data. The results show that the firms in both countries adjust their debt ownership structure towards their target levels - British firms being the swiftest. The findings confirm the validity of the liquidation and renegotiation hypothesis and the flotation cost hypothesis in both countries. However, the moral hazard and adverse selection hypothesis receives strong support in the UK but not in Germany. Moreover, the role of control factors (market related variables) in determining the choice of the lender is country dependent. Therefore, the debt ownership structure of a firm is influenced by both the firm-specific factors and the financial systems and corporate governance traditions in which the firm operates.
Author | : Fauzias Mat Nor |
Publisher | : |
Total Pages | : |
Release | : 1999 |
Genre | : |
ISBN | : |
Author | : Saumitra N. Bhaduri |
Publisher | : |
Total Pages | : |
Release | : 2000 |
Genre | : |
ISBN | : |
The study investigate the relationship between debt ownership structure and various firm specific characteristics suggested by recent theories for an emerging economy, India, which is a unique hybrid of a market-based and a bank-oriented system. Bank debt use, which is also the predominant source of long-term borrowings in India, is negatively related to age, size, volatility of earning growth, leverage and positively related to the fixed asset ratio. These findings are consistent with the theoretical models that argue a positive association between bank debt use and high information and monitoring costs, less likelihood and cost of inefficient liquidation and high incentive to take actions harmful to the lender.
Author | : Ewa J. Kleczyk |
Publisher | : |
Total Pages | : |
Release | : 2012 |
Genre | : Economics |
ISBN | : |
The Determinants of Corporate Debt Maturity Structure.
Author | : Antonios Antoniou |
Publisher | : |
Total Pages | : 47 |
Release | : 2004 |
Genre | : |
ISBN | : |
This study examines the determinants of corporate debt maturity structure decisions of French, German and UK firms using panel data. These countries are characterised by different financial systems and traditions that have implications on how firms decide their debt maturity structure. We apply several alternative estimation methods and show that in debt structure modelling endogeneity problem should be controlled for. We do so by using Generalised Method of Moments (GMM) estimation method. The GMM results suggest that firms in all three countries adjust their debt ratios to attain their target maturity structure. However, the speed at which firms adjust their maturity structure towards their target levels differs from one country to another. A direct association of debt maturity with leverage in all countries confirms the predictions of the liquidity risk argument. However, corporate tax rate, growth opportunities, liquidity, firm quality, earnings volatility, asset maturity and firm size have different degree and direction of effect on debt maturity across the sample countries. Apart from these firm-specific factors, we also find that the impact of market-related factors (term structure of interest rates, equity premium, share price performance, and interest rate volatility) on debt maturity is country dependent. Hence, the debt maturity structure of a firm is determined by both firm-specific factors and country-specific effects.
Author | : Arindam Bandyopadhyay |
Publisher | : Cambridge University Press |
Total Pages | : 390 |
Release | : 2016-05-09 |
Genre | : Business & Economics |
ISBN | : 110714647X |
This book explains how a proper credit risk management framework enables banks to identify, assess and manage the risk proactively.
Author | : Fabio Schiantarelli |
Publisher | : World Bank Publications |
Total Pages | : 44 |
Release | : 1997 |
Genre | : Corporate debt |
ISBN | : |
Author | : Gordon Donaldson |
Publisher | : Beard Books |
Total Pages | : 316 |
Release | : 2000-07 |
Genre | : Business & Economics |
ISBN | : 9781587980343 |
Author | : |
Publisher | : |
Total Pages | : 76 |
Release | : 1995 |
Genre | : Corporate debt |
ISBN | : |