Country and industry effects in corporate bond spreads in emerging markets

Garay, Urbi; González, Maximiliano; Rosso, John

doi:10.1016/j.jbusres.2017.09.021

Cited by 12 publications

(9 citation statements)

References 37 publications

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“…Therefore, the suggested hypothesis of the presence of a negative yield premium on green bonds is not rejected. Based on the results of the obtained model we conclude that with green bonds, the spread reduces by 23.4% 12 . The second hypothesis, on the differences in marketability between green bonds and commensurable traditional issues, was tested using the same sample, and the descriptive statistics and the process of eliminating outlying data coincide with the procedures described above.…”

Section: Analysis Of the Sample And Descriptive Statisticsmentioning

confidence: 77%

“…In order to enhance understanding of the topic and construct a more accurate model, it is necessary to study the factors which in the majority of cases influence the rates of return of corporate bonds. On the basis of the considered articles [12][13][14][15][16][17][18][19][20][21][22] one can make a conclusion that macroeconomic indicators, and the individual characteristics of issues and issuing companies have a significant impact on the yield factor, while the sectoral affiliation and the location country's characteristics are not always of significance.…”

Section: The Fundamental Factors Which Influence the Yield Spread Of mentioning

confidence: 99%

“…GDP (Gross Domestic Product Growth Rate) is the USA gross domestic product growth rate which corresponds to 12 Interpretation of results in percent on the basis of use of the dependent variable logarithm in the econometric model. the year of issue and is measured in terms of percent.…”

Section: Cpn (Couponmentioning

confidence: 99%

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Do Investors Pay Yield Premiums On Green Bonds?

Ivashkovskaya¹,

Anna²

2020

КФ

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Global shifts in perspectives on environmental concerns and the growing significance of large-scale sustainabilityprograms have brought the issue of green financing to the fore of financial research. In terms of volume, this area hasdemonstrated high growth rates in various types of capital markets.Unfortunately, few studies exist which explore the yields on green bonds in emerging markets in comparison todeveloped ones. As such, in this paper, we contribute new evidence to the field of green financing and outline severalmajor differences between green issues in these types of capital markets.We study yield premiums of green bonds on a sample of 2,450 green issues and comparable traditional bonds over theperiod from 2008 to March 2020. We contribute to the literature by new empirical evidence on green financing.Our results provide evidence of small but statistically significant negative premiums on green bonds of 23,4%1 comparedto the expected yields for standard issues. We also show that the negative premium on green bonds is more pronouncedin developed markets (- 27%2) than in emerging ones (18%3). Moreover, we provide new evidence on the negativepremium-liquidity relationship. Our research concludes that negative premiums are related to a higher level of liquidity:green bonds have lower bid-ask spreads and a higher level of liquidity than traditional ones.These conclusions can assist investors, potential issuing companies, and public authorities in achieving a betterunderstanding of the current situation of the green bond market in global terms.

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Section: Analysis Of the Sample And Descriptive Statisticsmentioning

confidence: 77%

Section: The Fundamental Factors Which Influence the Yield Spread Of mentioning

confidence: 99%

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Do Investors Pay Yield Premiums On Green Bonds?

Ivashkovskaya¹,

Anna²

2020

КФ

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“…Factors that influence on cost of bonds include the macroeconomic conditions [8] , the bond characteristics and issuer characteristics [9] . Common indicators of bond characteristics are mainly related to debt credit rating [10] , issue amount and bond maturity [11] .…”

Section: Variable Definitionmentioning

confidence: 99%

Research on the Impact of Third-Party Certification on Green Bond Spread of the Green Industry－Considering the Effect of the Nature of Property Rights

Hu¹

2021

converter

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Capital is the most basic element of production organization, and green bonds are important financing sources for the green industry. Financingcosts directly affect the steady development of the green industry. In order to verify whether third-party certification can reduce the financing cost of green bonds and whether the nature of property rights has an impact on the reduction, 285 green bonds issued from 2016 to 2019 are taken as samples, and then a hierarchical multiple statistical regression analysis method is adopted to conduct a quantitative study. The results show that third-party certification, as a unique credit enhancement method for green bonds, can significantly reduce green bond spreads. In addition, it isgreater that the effect on non-state-owned enterprises’ green bonds is. Since bond spread isamain part of financing costs, the above means that third-party certification can reduce the financing costs of green bonds, especiallyfor non-state-owned enterprises. In this regard, starting from reducing the cost of green bonds, the paper proposes to improve the green bond evaluation and certification standards as soon as possible, non-state-owned enterprises particularly should actively carry out third-party certification, and the government needs to further increase the implementation of third-party certification as well as strengthen multi-party cooperation.

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“…Based on the agency theory, many studies find that the board characteristics and ownership structure are important factors that affect the valuation of corporate bonds (Anderson, Mansi, & Reeb, 2004;Anderson, Mansi, & Reef, 2002;Bhojraj & Sengupta, 2003;Shailer & Wang, 2015). Other studies focus on the external governance, such as country and industry effects (Garay, González, & Rosso, 2019), taxes (Landoni, 2018;Liu, Shi, Wang, & Wu, 2007), and monetary policy measures (Gürtler & Neelmeier, 2018).…”

Section: Institutional Backgrounds Of Corporate Debt In Chinamentioning

confidence: 99%

Do social ties matter for corporate bond yield spreads? Evidence from China

Qiu

Xiao

2019

Corporate Governance

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Research Question/Issue: This paper studies the effect of top management team (TMT) network centrality on corporate bond yield spreads. In additional analyses, we examine the hierarchical structures of TMT and study which parts contribute to the decrease in bond yield spreads. We also examine the mediating roles (including informed trading probability, media coverage, political ties, financial ties, and bond ratings) and the moderating roles (including marketization and analysts following) in the correlation between TMT network centrality and corporate bond yield spreads.Research Findings/Insights: This paper finds that firms with high TMT network centrality are significantly negatively correlated with lower bond yield spreads. The findings are robust after controlling for a series of sensitivity checks and endogenous concerns. The results of the hierarchical structures show that the decrease of bond spreads is accounted for CFOs' networks and board members' networks, whereas the role of CEOs' networks is not apparent. More importantly, after controlling CEOs'

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Country and industry effects in corporate bond spreads in emerging markets

Cited by 12 publications

References 37 publications

Do Investors Pay Yield Premiums On Green Bonds?

Do Investors Pay Yield Premiums On Green Bonds?

Research on the Impact of Third-Party Certification on Green Bond Spread of the Green Industry－Considering the Effect of the Nature of Property Rights

Do social ties matter for corporate bond yield spreads? Evidence from China

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