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Rent extraction by super-priority lenders

Eckbo, B. Espen; Li, Kai; Wang, Wei - 2019

We present strong evidence of supra-competitive pricing of debtor-in-possession (DIP) loans to large firms in Chapter 11 bankruptcy. Over-collateralized and with super-priority, strong covenants, rollups, and debtor-funded monitoring costs, these loans are almost risk-free. Nonetheless, loan...

Persistent link: https://www.econbiz.de/10012104589

Lending Relationships and the Transmission of Liquidity Shocks : Evidence from a Natural Experiment

Bai, Yiyi - 2017

We exploit a liquidity crunch of 2013 in China as a negative shock to banks and analyze the wealth effects on listed firms. Our findings show that liquidity shocks to financial institutions impact borrowers' performance negatively. However, firms having long-term relationship with banks...

Persistent link: https://www.econbiz.de/10012950512

Credit Building or Credit Crumbling? A Credit Builder Loan’s Effects on Consumer Behavior, Credit Scores and Their Predictive Power

Burke, Jeremy - 2020

There is little evidence on how the large market for credit score improvement products affects consumers or credit … market efficiency. A randomized encouragement design on a standard credit builder loan (CBL) identifies null average effects … on whether consumers have a credit score and the score itself, with important heterogeneity: those with loans outstanding …

Persistent link: https://www.econbiz.de/10012848541

Internet Appendix for “Lending Relationships and the Pricing of Syndicated Loans”

Zhang, Donghang; Zhang, Yafei; Zhao, Yijia (Eddie) - 2022

This is an Internet Appendix with additional tables for Zhang, Zhang, and Zhao (2022, available at https://ssrn.com/abstract=3519341). The abstract of the paper is as follows:Using a dataset on syndicated loan primary market pricing adjustments, we examine whether relationship banks’...

Persistent link: https://www.econbiz.de/10014236530

When Fintech Lending Meets Privacy Protection : The Role of Privacy-Insensitive Device Attributes in Identifying Loan Default

Hu, Jun; Li, Qiang; Yong, Zeng - 2022

ongoing tension between privacy protection and credit efficiency. Using a unique applicant-level data from a leading Fintech … credit institution in China and merging two basic device attributes extracted from applicant’s mobile phone with public … currently available credit scores. The default probabilities are lower among applicants who use mobile phones with higher price …

Persistent link: https://www.econbiz.de/10013491839

Macroeconomic Determinants of Loan Delinquencies : Evidence from the US Peer-to-Peer Lending Market

Nigmonov, Asror; Shams, Syed; Alam, Khorshed - 2021

macroeconomic factors that influence credit risk in the peer-to-peer (P2P) lending market. By aggregating the United States (US …

Persistent link: https://www.econbiz.de/10013230437

Bank private information in CDS markets

Bilan, Andrada; Ongena, Steven; Pancaro, Cosimo - 2023

Can banks trade credit default swaps (CDSs) referenced on their current corporate clients at competitive prices, or are …

Persistent link: https://www.econbiz.de/10014315233

Price Transparency in OTC Equity Lending Markets : Evidence From a Loan Fee Benchmark

Cereda, Fabio - 2020

We study the effects of a price transparency shock in the Brazilian OTC equity lending market. Previously, a publicly available stock-specific loan fee benchmark was the average fee of the past 15 trading days. On March 1, 2011, this interval was reduced to 3 days, significantly improving...

Persistent link: https://www.econbiz.de/10012840273

Bank Loan Price Reactions to Corporate Events : Evidence from Traded Syndicated Loans

Billett, Matthew T. - 2015

We examine the effect of open market share repurchase announcements on prices of traded loans and find a significant wealth transfer effect; the change in the market value of equity is inversely related to the change in the market value of loans. We find that loan abnormal returns are more...

Persistent link: https://www.econbiz.de/10013030285

Are Bank Loans Still 'Special' (Especially During a Crisis)? Empirical Evidence from a European Country

Godlewski, Christophe J. - 2012

We investigate bank loans' specialness with a particular focus on the recent boom and bust cycle. We perform an empirical analysis using event study methodology on a sample of 253 large loan announcements for French borrowers between January 2000 and December 2009. We find a significant and...

Persistent link: https://www.econbiz.de/10013110210