Carrizosa and Ryan (2017) explore the use of private information covenants, which contractually oblige borrowers to provide their lenders with private information: projected or intra-quarter financial statements. The authors offer evidence that creditors acquire private information about...

This paper documents a reciprocal cross-holding relation (CHR) between financial conglomerates: banks mutually hold each other's money market instruments through their affiliated money market funds (MMFs). Using novel MMF holdings data, this study shows that U.S. banks increased their MMFs'...

In this study, we examine the options market reaction to bank loan announcements for the population of US firms with traded options and loan announcements during 1996-2010. We get evidence on a significant options market reaction to bank loan announcements in terms of levels and changes in...

We examine the impact of SFAS 133, Accounting for Derivative Instruments and Hedging Activities, on the reporting behavior of commercial banks and the informativeness of their financial statements. We argue that, because mandatory recognition of hedge ineffectiveness under SFAS 133 reduced...

We assess the extent to which discretion, unexplained variations in the terms of a loan contract, has varied across time and lending institutions and show that part of this discretion is due to private information that lenders have on their borrowers. We find that discretion is lower for secured...

Recent evidence suggests that investors struggle to process complex financial disclosures. Relative to equity and public debt investors, banks have unique advantages in acquiring information and can impose contractual terms to mitigate information frictions. We investigate whether financial...

We examine the roles of information sharing, strength of legal rights and bank size on the procyclical effect of bank loan loss provisions in an emerging Asian market context. Based on a sample of Asian banks from 11 countries over the 2002-2012 period, our empirical results indicate that higher...

This study jointly evaluates the effects of the U.S. Treasury's Troubled Asset Relief Program (TARP), the Federal Reserve's Discount Window (DW) and Term Auction Facility (TAF) on bank syndicated lending during the 2007-2009 financial crisis, using a unique data set that tracks the exposure of...

We employ a unique data set that tracks the changes of each lender's share commitment in each syndicated credit facility in each year to study the relationship between credit cuts and the borrowing firms' future performance. Overcoming the crucial data limitations in prior empirical studies of...

We find that bond issuers receive bank loans with 11% fewer covenants when the secondary corporate bond market becomes more transparent. The treatment effect is more pronounced when the stock prices are less informative and when the debt-equity agency conflicts are more severe. The evidence...