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multinational operations are more likely to work with global banks for international banking services …
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We empirically examine three channels in the relation between banks' CDS trading and loan sales. The substitute channel predicts a negative relation between CDS hedging and loan sales, and the complementary channel predicts a positive relation. The credit-enhancement channel predicts a positive...
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Do banks use credit default swap hedging to substitute for loan sales? By tracking banks' lending exposures and CDS positions on individual firms, we find that banks use CDS hedging to complement rather than to substitute for loan sales. Consequently, bank loan sales are higher for firms that...
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the absolute priority rule (APR) by creditors, thus making it possible to explain this seemingly contradictory banking … testing for a significant difference in banking behavior before and after the Court decision using data from Japanese firms in …
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