We analyse whether soliciting multiple ratings leads to lower syndicated loan spreads. Our results document that banks apply, on average, lower spreads to multi-rated firms. This effect depends on the reduction of information asymmetry about borrowers' creditworthiness (information production...

In this paper we review the pricing and model calibration of Credit Default Swaps referring to both the International Swaps and Derivatives Association (ISDA) CDS contract and credit model standardization guidelines. Furthermore we provide an Excel pricing workbook to supplement the materials...

How do different types of debt influence firm credit risk? This paper sheds new light on this issue by decomposing the leverage ratio into market debt, bank debt, and trade credit leverage ratios by balance sheet account type classification; and short-term debt and long-term debt leverage ratios...

Corporate credit ratings have tightened gradually but substantially over two decades. We ex- amine whether syndicated loans correct for the conservatism. We find that they do not. The correction in spreads is greater for smaller, speculative borrowers, loans with fewer lenders and a greater lead...

A covenant is a special set of clauses in a firm's debt contract restricting business policy and allowing creditors to take specified action should the covenant terms be violated. Three main reasons for the inclusion of covenants in debt contracts are accounted for in the literature: they (1)...

Using a sample of 4757 bilateral bank loans to Chinese enterprises, we analyze the effect of firms' initial public offerings (IPOs) on interest rate savings. Our evidence shows that following successful equity IPOs, firms are granted with a significant discount in their cost of credit. This...

We analyze whether the disaggregation quality (DQ) of a borrower's financial statement is associated with its bank loan pricing. We find that firms with low DQ have high bank loan spreads and total cost of borrowing. These results are more pronounced for risky and poorly governed firms....

We examine the factors that influence public firms' choice between project financing and corporate financing. Using a sample of 15,191 syndicated deals closed between 2000 and 2016, we find that economies of scale, agency costs of debt, and information asymmetry arguments affect the choice of...

Peer-to-business lending refers to online platforms facilitating loans from individuals to small and medium-sized enterprises (SMEs). We conjecture that easy-to-understand risk ratings conveyed by the platform play a pronounced role in influencing the borrowing success of SMEs and that more...

This paper extends what we know about loss given default (LGD) on commercial loans by studying certain types of these loans that have been excluded from previous research but that may be more representative of loans held by small and mid-sized banks. We use a newly available dataset on...