the cost of ex-post inefficiency when there are adverse aggregate shocks to the fundamental quality of collateral … shocks by engaging in collateral liquidations. Financial arbitrage by less leveraged financial intermediaries equilibrates … returns from acquiring collateral at fire-sale prices and returns from real-sector lending, inducing higher lending rates, a …

. First, we find that banks increase the supply of credit subsequent to legal change. Second, changes in collateral law matter … of collateral and bankruptcy law. While the former enhances the likelihood that individual creditors can realize their …

tend not to face higher interest rates because they provide collateral. This paper illustrates these effects in a model and …

tend not to face higher interest rates because they provide collateral. This paper illustrates these effects in a model and …

Studies indicate that a consistent rise in insolvency risk should be addressed at the strategic level. Vigilant boards … can use leverage maturity structure as a tool to control insolvency risk. However, according to the information asymmetry … theory, leverage acquisition is subject to the presence of fixed assets which can be used as collateral. The current study …

In this study we estimate indirect bankruptcy costs for a recent sample of large corporate bankruptcies in the United … States over the period, 1997 to 2004. We find indirect bankruptcy costs of approximately 2%, 6.2% and 14.9% of firm value in … years -3, -2 and -1 relative to the year of bankruptcy announcement respectively. Together with the direct costs reported in …