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Germany is a reluctant supporter of the EU funds which are being used in the ‘bailout' of Ireland, and it insists on strict ‘austerity' conditions, concerned about risk and moral hazard.However, through its central bank, Germany is lending €325bn (December 2010) to other central banks in...
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• The exit consent technique refers to an offer by a bond issuer to all the bondholders to exchange the existing bonds for new bonds or other types of securities, on the condition that the tendering bondholders must consent to a resolution which will amend the terms of the existing bonds so as...
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and borrowers ample reason to care whether nonperforming debts are restructured. One implication of the way in which debt … argument is moral hazard, but (unlike in much of the recent literature of emerging market debt problems) what is central here …
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This paper studies whether debt renegotiation mitigates debt overhang and improves investment efficiency. Using mergers … unsecured loans, providing further support that lender mergers improves investment efficiency for firms suffering from debt …
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In this paper we build a theoretical model of a firm repurchasing its corporate debt. We find that firm creditors as a … group sell debt to the firm only at face value. However, because of the cross-creditor externalities buying back debt is … cheaper and easier when there are many creditors, e.g., when debt is traded on the open market. We further show that …
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