Syndicated Loan Announcements and Borrower Value

Gasbarro, Dominic; Le, Kim-Song; Schwebach, Robert G.; Zumwalt, J. Kenton

doi:10.1111/j.1475-6803.2004.00081.x

Cited by 22 publications

(8 citation statements)

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“…Using the January 2004-December 2012 period, 8,867 syndicated loan announcements are obtained and used to examine the impact of the financial crisis. Similar to Gasbarro et al (2004), 16 we partition loans based on loan types: 13 The claim that more screening and monitoring are required for borrowers in the middle of the credit ratings is consistent with Diamond (1991) and Berg et al (2017). 14 Berg et al (2017) consider loan types, loan purpose, and borrower ratings in their analyses, and the partitions in this study parallels their approach.…”

Section: Methodsmentioning

confidence: 98%

“…Similar to Gasbarro et al (2004), 16 we partition loans based on loan types: 13 The claim that more screening and monitoring are required for borrowers in the middle of the credit ratings is consistent with Diamond (1991) and Berg et al (2017). The Center for Research in Security Prices (CRSP) database is screened to identify firms with return data over that period to allow examination of the market impact of the announcements.…”

Section: Methodsmentioning

confidence: 99%

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An Analysis of Syndicated Loan Announcements During the Global Financial Crisis

Gasbarro

Schwebach

et al. 2017

J of Financial Research

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The recent financial crisis presents an opportunity to examine stock market reactions to syndicated loan decisions reached by borrowers and lenders regarding loan type and loan purpose. We find that during the crisis, the renegotiation flexibility provided by revolving credit is positively valued, whereas during the low‐interest‐rate period following the crisis, both revolving and term loans are viewed favorably. We also examine information asymmetry effects and find that after the crisis, low‐creditworthy borrowers generate a positive market response, but during the crisis, high‐creditworthy borrowers are viewed positively and low‐creditworthy borrowers are punished by the market.

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Section: Methodsmentioning

confidence: 98%

Section: Methodsmentioning

confidence: 99%

An Analysis of Syndicated Loan Announcements During the Global Financial Crisis

Gasbarro

Schwebach

et al. 2017

J of Financial Research

Self Cite

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“…See, for instance,Lummer and McConnell (1989);Preece and Mullineaux (1996); andGasbarro et al (2004) MacKinlay (1997). provides an excellent survey on event studies methods.…”

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confidence: 99%

Do Markets Perceive Sukuk and Conventional Bonds as Different Financing Instruments?

2011

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Do markets perceive sukuk and conventional bonds as different financing instruments? AbstractThe last decade witnessed a proliferation in issues of sukuk, Islamic financial instruments structured to replicate the cash flows of conventional bonds. Using a market-based approach on Malaysian data, we consider whether investors react differently to the announcements of sukuk and conventional bond issues. Our findings suggest the stock market is neutral to announcements of conventional bond issues, but reacts negatively to announcements of sukuk issues. We attribute this finding to the excess demand for Islamic investment certificates and explain the difference in stock market reactions as an adverse selection mechanism that favors sukuk issuance by lower-quality debtor companies. Unlike previous studies, our findings indicate markets readily distinguish between sukuk and conventional bonds. JEL Codes: G14, P51

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“…Dumontaux and Pop (2013) study the stock market reaction to Lehman's failure, and find that the biggest firms, those that hold crucial positions in the system, were most affected by Lehman's demise. Similar to this paper, Gasbarro, Le, Schwebach, and Zumwalt (2004) investigate stock market reactions to syndicated loan announcements. They focus on the borrower, rather than the lender, and find that loan announcements generate a positive wealth effect for the borrowing firm.…”

Section: Introductionmentioning

confidence: 95%

“…While obtaining a large loan can have a strong positive impact on the borrower (e.g. Gasbarro, Le, Schwebach, and Zumwalt, 2004), it could also be regarded as daily business of the leadarrangers. Stock markets may, however, react if the signing of the loan has a strong impact on the risk of the financial institution.…”

Section: Syndication Interconnectedness and The Equity Marketmentioning

confidence: 99%

Banking Beyond Bucks

Chalabi¹

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People interested in the research are advised to contact the author for the final version of the publication, or visit the DOI to the publisher's website. • The final author version and the galley proof are versions of the publication after peer review. • The final published version features the final layout of the paper including the volume, issue and page numbers. Link to publication General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal. Preface The idea of giving thanks to everyone that has affected our lives, even if only briefly, is quite daunting. How could one ever thank everyone that has played a role, instrumental or not? How do we know how instrumental their role was? I approach this section with the ambition of brevity. My hope is that I show(ed) my gratitude and affection to those that were, and are, part of my life during our encounters. That said, there a few people that I need to thank, because I know, without them, I would not be here. Stefanie, I hope I showed my gratitude to you throughout the years. However, I know I never specifically mentioned how much I admire and respect you. Your work ethic, your dedication, and ambition are admirable. We have not had the smoothest relationship, but then again, which supervisor-PhD relationship is? Yet, I find myself being thankful for those bumpy roads, because I believe you learn the true qualities of people in difficult times, and I can honestly say that you are a good role model to have. Rob, you were never really involved in my projects, yet you were always there. I am incredibly lucky I had you to push, help, and listen to me through many phases, like going to NYU. Thank you, for being the mediator, the brains behind funding, and a guide for me. Nadja, our relationship was short, yet instrumental. The first year was a forming year, and I wouldn't be where I am today if not for you. Thank you for the trust you had in me, from day one. Tony, you welcomed me in NYU and gave me so much of your time, thank you for teaching me so much in a such a short period of time. To the committee members, Prof. Dennis Bams, Dr. Annelies Renders, Prof. Peter Sampers, and Prof. Harald Sander, thank you for taking the time to read my dissertation and providing me with comments to improve it, my gratitude is immense. Ladies, Carina, Cecile, Els and Francien, you are the center of gravity. I am now more aware than ever before, just how important you ladies really are. Thank you, not only for all the work you do, but also for ...

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Syndicated Loan Announcements and Borrower Value

Cited by 22 publications

References 14 publications

An Analysis of Syndicated Loan Announcements During the Global Financial Crisis

An Analysis of Syndicated Loan Announcements During the Global Financial Crisis

Do Markets Perceive Sukuk and Conventional Bonds as Different Financing Instruments?

Banking Beyond Bucks

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