CORIELLI, FRANCESCO; GATTI, STEFANO; STEFFANONI, ALESSANDRO - In: Journal of Money, Credit and Banking 42 (2010) 7, pp. 1295-1320
We study capital structure negotiation and cost of debt financing between sponsors and lenders using a sample of more than 1,000 project finance loans worth around US$195 billion closed between 1998 and 2003. We find that lenders: (i) rely on the network of nonfinancial contracts as a mechanism...