Do banks and industrial companies have equal access to reputable underwriters in debt markets?
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In: Journal of Corporate Finance, Vol. 45, 08.2017, p. 176-202.
Research output: Contribution to journal › Article › peer-review
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TY - JOUR
T1 - Do banks and industrial companies have equal access to reputable underwriters in debt markets?
AU - Carbo-Valverde, Santiago
AU - Cuadros Solas, Pedro
AU - Rodríguez-Fernández, Francisco
PY - 2017/8
Y1 - 2017/8
N2 - We analyze whether banks and industrial companies have equal access to debt markets through reputable underwriters and explore the determinants of that matching for both types of firms. Using a sample of European corporate bonds during the years 2003-2013, we find that the odds of matching with a reputable underwriter were about 1.5 times greater for non-financial companies than for banks. The odds of matching with a reputable underwriter were 10.92 times lower for a bank during the crisis. As for the determinants of the matching probability, the marginal effect of the bond size on the matching probability is 1.70 larger for non-financial firms than for banks. Furthermore, the effect of bond size is greater for large non-financial companies than for large banks while the effect of maturity is larger for banks than for non-financial companies.
AB - We analyze whether banks and industrial companies have equal access to debt markets through reputable underwriters and explore the determinants of that matching for both types of firms. Using a sample of European corporate bonds during the years 2003-2013, we find that the odds of matching with a reputable underwriter were about 1.5 times greater for non-financial companies than for banks. The odds of matching with a reputable underwriter were 10.92 times lower for a bank during the crisis. As for the determinants of the matching probability, the marginal effect of the bond size on the matching probability is 1.70 larger for non-financial firms than for banks. Furthermore, the effect of bond size is greater for large non-financial companies than for large banks while the effect of maturity is larger for banks than for non-financial companies.
KW - Underwriter reputation
KW - Corporate bonds
KW - Assymmetires
KW - Banks
KW - Underwriting
U2 - 10.1016/j.jcorpfin.2017.04.015
DO - 10.1016/j.jcorpfin.2017.04.015
M3 - Article
VL - 45
SP - 176
EP - 202
JO - Journal of Corporate Finance
JF - Journal of Corporate Finance
SN - 0929-1199
ER -