Credit spreads in the market for highly leveraged transaction loans

Angbazo, Lazarus A.; Mei, Jianping; Saunders, Anthony

doi:10.1016/s0378-4266(98)00065-x

Cited by 127 publications

(105 citation statements)

References 23 publications

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“…A longer maturity leads to a higher spread (attributable particularly to the higher risk involved), and a higher amount leads to a lower spread (chiefly due to economies of scale on the bank's fixed costs). We thus confirm the majority findings in the literature (Angbazo et al 1998, Casolaro et al 2003and Altunbas and Gadanecz 2004 3 . Logically, a large spread (which is a sign of a high default risk) tends to reduce the amount loaned and the loan's maturity, presumably for reasons of prudence.…”

Section: Analysis Of Loan Terms In 2008supporting

confidence: 92%

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Does a Banking Relationship Help a Firm on the Syndicated Loans Market in a Time of Financial Crisis?

2010

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The volume of credit granted in the form of syndicated loans saw a marked downturn in 2008.This article seeks to understand how certain firms were nonetheless able to benefit from larger facilities or a lower interest rate than others. Using a sample of syndicated loans issued in 2008 in North America and Europe, and records of syndicated loans since 2003, we show that firms that had developed a relationship with an investment bank obtained a lower spread, but did not benefit from greater loan facilities or longer maturities.JEL classification: G10, G21, G32

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Section: Analysis Of Loan Terms In 2008supporting

confidence: 92%

“…We find no significant link with the spread, contrary to the results reported by Angbazo et al (1998), Harjoto et al (1998) andBosch (2007). Another interesting finding is the role of belonging to the real estate sector: as expected, the impact on the spread is positive, while the impact on maturity is negative.…”

Section: Analysis Of Loan Terms In 2008contrasting

confidence: 87%

Does a Banking Relationship Help a Firm on the Syndicated Loans Market in a Time of Financial Crisis?

2010

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“…Syndicated loan announcements have also been used to evaluate possible bank certification effects on the market value of a firm (Meggison et al (1995), Preece and Mullineaux (2003), Lummer and McConnell (1989) and Billett et al (1995)). There is also evidence on the pricing of syndicated loans in relation to lender characteristics and the borrower's default risk (Hubbard et al (2002), Coleman et al (2006), Thomas and Wang (2004), Angbazo et al (1998) and Altman and Suggitt (2000) Eurostat to obtain official statistics on macroeconomic data.…”

Section: Ecb Working Paper Series No 1028mentioning

confidence: 99%

Large debt financing: syndicated loans versus corporate bonds

Altunbaş

Kara

Marqués-Ibáñez

2010

The European Journal of Finance

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract 4 Non-technical summary 5 Terms of use: Documents in

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“…60 See Bester (1985), Chan and Kanatas (1985) and Besanko and Thakor (1987). 61 This assumption is approved both by empirical analyses that detect a minor quality of the ratings of loans provided with collateral (see Orgler (1970), Hester (1979), Scott and Smith (1986)) and by those that verify a higher risk premium of collateralized loans (see Udell (1990, 1992), Booth (1992), Booth and Chua (1996), Angbazo et al (1998)). See Jiménez and Saurina (2004), p. 2194 per seq.…”

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confidence: 99%