Kleimeier, Stefanie and Chaudhry, Sajid M. (2015). Cultural differences and the structure of loan syndicates. Finance Research Letters, 15 , pp. 115-124.
Abstract
Do cultural differences between lender and borrower affect the structure of the loan syndicate? Analyzing 8031 syndicated loans to US borrowers signed between 1986 and 2007, we find that lending shares are higher for foreign arrangers than domestic arrangers. Among foreign arrangers, lending shares further increase with cultural distance. We interpret this as a result of an increased moral hazard problem driven by higher information and effort costs faced by foreign arrangers. However, previous interactions between borrowers and arrangers can reduce moral hazard, hence culturally distant arrangers are able to form diffused syndicates.
Publication DOI: | https://doi.org/10.1016/j.frl.2015.09.001 |
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Divisions: | College of Business and Social Sciences > Aston Business School |
Additional Information: | © 2015, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International http://creativecommons.org/licenses/by-nc-nd/4.0/ |
Publication ISSN: | 1544-6131 |
Last Modified: | 06 Aug 2024 08:10 |
Date Deposited: | 15 Nov 2018 13:20 |
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Related URLs: |
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PURE Output Type: | Article |
Published Date: | 2015-11-01 |
Authors: |
Kleimeier, Stefanie
Chaudhry, Sajid M. ( ![]() |
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