Different market characteristics and investor behavior render the use of underpricing, widely used for equity IPOs, inadequate as a measure of gains from primary market allocations in corporate bonds. We propose a measure that reflects the illiquidity costs that investors save by avoiding...

Although a vast theoretical literature suggests that banks’ screening and monitoring skill makes them special, there is limited direct evidence on the level and sources of value creation from bank lending activities. Using a novel dataset of realized loan cash-flows and a risk-adjustment...

Using a regulatory version of TRACE data that include almost all primary and secondary market trades in corporate bonds over the period 2010-2017, we provide the first comprehensive study on the primary market for corporate bonds. Secondary market illiquidity can drive gains from primary market...

Despite plenty of anecdotal evidence of hidden losses in banks, there is no systematic study analyzing the economic drivers of this behavior: we simply do not get to observe what banks are hiding unless they are caught. Using a regulatory change in India that forced all commercial banks to...