Do banks and industrial companies have equal access to reputable underwriters in debt markets?

Carbó-Valverde, Santiago; Cuadros-Solas, Pedro J.; Rodríguez-Fernández, Francisco

doi:10.1016/j.jcorpfin.2017.04.015

Cited by 10 publications

(6 citation statements)

References 101 publications

(164 reference statements)

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“…Our paper contributes to two main fields of literature. Firstly, it contributes to the recent banking literature focused on banks' digitisation process (Carbó‐Valverde, Cuadros‐Solas, Rodríguez‐Fernández, & Sánchez‐Béjar, 2023; Dadoukis et al., 2021; Kwan et al., 2021; Pierri & Timmer, 2022; among others) by showing that banks' digitalisation efforts have a direct impact on customers. Secondly, it contributes to the literature on consumer experience (Amin, 2016; Dehnert & Schumann, 2022; Herington & Weaven, 2009; among others) by providing empirical evidence on how customers' perceptions and satisfaction are directly affected by digital strategic choices.…”

Section: Introductionmentioning

confidence: 81%

Digital innovation and de‐branching in the banking industry: Customer perception and satisfaction

Carbó‐Valverde,

Cuadros‐Solas,

Rodríguez‐Fernández

et al. 2024

Global Policy

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In the ever‐changing landscape of the banking industry, digital transformation has become a major challenge. Banks are transitioning towards digitalisation by utilising information and digital technologies while reducing their branch networks. This paper investigates the relationship between technological innovation and banking customers' perception and satisfaction. By analysing a comprehensive consumer finance survey, we assess how the digital transformation of banks is perceived by customers and its impact on their satisfaction. Our results demonstrate that customer perceptions of a bank's digital innovativeness are positively associated with effective digital transformation. Customers tend to be more satisfied with banks that have a higher degree of digitalisation. Furthermore, our findings reveal that customers view banks as more innovative when the reduction in bank branches since the pandemic has been more intense. These insights shed light on the technological transformation of banks and its influence on their customers, providing valuable information for banks seeking to navigate the digital landscape and improve customer satisfaction.

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Section: Introductionmentioning

confidence: 81%

Digital innovation and de‐branching in the banking industry: Customer perception and satisfaction

Carbó‐Valverde,

Cuadros‐Solas,

Rodríguez‐Fernández

et al. 2024

Global Policy

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“…30 One issue with this test in Table 6 is that bookrunner syndicate size and credit spreads have increased in parallel surrounding the financial crisis. Shivdasani andSong (2011) andCarbó-Valverde et al (2017) document an increase in the size bookrunner syndicates over time for US and European bond issues, respectively. This could lead to a spurious relation between syndicate size and investor demand, given the increase in demand surrounding the crisis documented previously.…”

Section: Impact Of Bookrunner Characteristicsmentioning

confidence: 99%

Orderbook demand for corporate bonds

Marshall

Krebbers

Neupane

et al. 2022

Euro Fin Management

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We examine the determinants of investor demand for corporate bond offerings using novel data on the primary market orderbook size. We find that credit risk and bond market presence are significant in explaining investor demand. These effects are more pronounced during the crisis periods including the global financial crisis and eurozone crisis as well as during the postcrisis periods. Our results also highlight the size of the bond investor order depends on information asymmetry costs and the benefit of diversifications, as investor demand is lower for new issuers as well as very frequent issuers. The levels of investor demand have important economic consequences for bond issuers as high investor demand shortens the time to subsequent bond issues and potentially reduces the firm's cost of capital at issuance.

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“…The recent studies by Jeon et al (2015) and Vithanage et al (2016) measure the underwriter reputation of the USA IPOs underwritten by multiple underwriters using the average reputation rank, instead of the highest market share as in Model 1 of Table 5, of the lead underwriting syndicate. Since such average reputation is calculated based on Carter and Manaster's (1990) measure of reputation rank which is not applicable to HK equity offerings, we follow Carb o-Valverde et al (2017) to calculate the syndicate market share and it is used as the underwriter reputation of the underwriting syndicate in our SUBP model. We replace our three measures (REP, REP prior and ΔREP prior ) of underwriter reputation with REP syn , REP prior.syn , ΔREP prior.syn and Model 2 in Part B of Table 5 reports the results.…”

Section: Clustering Of Gross Spreads and Switchingmentioning

confidence: 99%

Clustering of percentage gross spreads and the avoidance of underwriter switching

Lee

Too

Ooi

2022

IJMF

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PurposeBoth issuing firms and underwriters shall benefit from the associations in underwriting contracts for seasoned equity offerings (SEOs). Issuing firms that are offered underwriting contracts with clustered gross spreads do not have strong incentives to switch away from the firms' prior SEO underwriters, and thus these existing underwriters are able to maintain or gain greater market share. This study investigates how the clustering of percentage gross spreads affects the likelihood of underwriter switching.Design/methodology/approachUsing the investment bank-underwritten SEOs in Hong Kong, the authors find that the percentage gross spreads of 40% of these SEOs are clustered at 2.5%. The seemingly unrelated bivariate probit model, Weibull survival mixed model and trivariate probit model are applied to analyse this phenomenon.FindingsThe authors' study provides first direct evidence that the clustering of percentage gross spreads lowers the likelihood of underwriter switching. Investment banks as underwriters can explicitly price underwriting contracts at a clustered level, more likely in periods of greater market volatility, and intentionally retain the banks' client firms using pricing arrangements. The authors' finding and approach offer more direct and distinct support that the issuer–underwriter association can be relationship-based.Originality/valueWhilst the clustering of fees is interpreted as a type of anticompetitive price sitting, the authors contribute to literature by providing new empirical evidence on why percentage gross spreads as a price dimension are clustered. On top of contract efficiency and collusion, this study's new evidence provides a third view for the clustering of gross spreads.

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Do banks and industrial companies have equal access to reputable underwriters in debt markets?

Cited by 10 publications

References 101 publications

Digital innovation and de‐branching in the banking industry: Customer perception and satisfaction

Digital innovation and de‐branching in the banking industry: Customer perception and satisfaction

Orderbook demand for corporate bonds

Clustering of percentage gross spreads and the avoidance of underwriter switching

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