Bank monitoring and the maturity structure of Japanese corporate debt issues
Research output: Journal Publications and Reviews › RGC 21 - Publication in refereed journal › peer-review
Author(s)
Related Research Unit(s)
Detail(s)
Original language | English |
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Pages (from-to) | 229-250 |
Journal / Publication | Pacific Basin Finance Journal |
Volume | 7 |
Issue number | 3-4 |
Publication status | Published - Aug 1999 |
Link(s)
Abstract
Extant literature suggests that bank lending results in greater information production and control over corporate borrowers. We show that bank lending creates positive externalities in that it improves the contracting environment for other public debt providers. Focusing on the maturity structure of Japanese corporate debt issues, we provide evidence that a higher proportion of bank debt results in public debt of longer maturity. More importantly, the sensitivity of the debt maturity to bank debt ratio is significantly higher for independent firms compared with that of keiretsu-affiliated firms. The evidence is consistent with keiretsu firms having less agency costs of debt compared with independent firms.
Research Area(s)
- Agency costs, Bank monitoring, Debt maturity, G21, G32, G38, Japanese corporate finance
Citation Format(s)
Bank monitoring and the maturity structure of Japanese corporate debt issues. / Cai, Jun; Cheung, Yan-Leung; Goyal, Vidhan K.
In: Pacific Basin Finance Journal, Vol. 7, No. 3-4, 08.1999, p. 229-250.
In: Pacific Basin Finance Journal, Vol. 7, No. 3-4, 08.1999, p. 229-250.
Research output: Journal Publications and Reviews › RGC 21 - Publication in refereed journal › peer-review