The Experts below are selected from a list of 360 Experts worldwide ranked by ideXlab platform
William J Wilhelm - One of the best experts on this subject based on the ideXlab platform.
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competing for securities Underwriting mandates banking relationships and analyst recommendations
Social Science Research Network, 2003Co-Authors: Alexander Ljungqvist, Felicia C Marston, William J WilhelmAbstract:We investigate directly whether analyst behavior influenced the likelihood of banks winning Underwriting mandates for a sample of 16,625 U.S. debt and equity offerings sold between December 1993 and June 2002. We control for the strength of the issuer's investment-banking relationships with potential competitors for the mandate, prior lending relationships, and the endogeneity of analyst behavior and the bank's decision to provide analyst coverage. We find no evidence that aggressive analyst recommendations or recommendation upgrades increased their bank's probability of winning an Underwriting mandate after controlling for analysts' career concerns and bank reputation. Our findings might be interpreted as suggesting that bank and analyst credibility are central to resolving information frictions associated with securities offerings.
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competing for securities Underwriting mandates banking relationships and analyst recommendations
Research Papers in Economics, 2003Co-Authors: Alexander Ljungqvist, Felicia C Marston, William J WilhelmAbstract:We investigate directly whether analyst behaviour influenced the likelihood of banks winning Underwriting mandates for a sample of 16,625 US debt and equity offerings sold between December 1993 and June 2002. We control for the strength of the issuer’s investment-banking relationships with potential competitors for the mandate, prior lending relationships, and the endogeneity of analyst behaviour and the bank’s decision to provide analyst coverage. Contrary to recent allegations, we find no evidence that aggressive analyst recommendations or recommendation upgrades increased a bank’s probability of winning an Underwriting mandate once we control for analysts’ career concerns. In fact, the opposite appears to be the case. We interpret this finding as evidence that credibility is central to resolving information frictions associated with securities offerings. Overly aggressive analyst behaviour undermines credibility.
Anthony Saunders - One of the best experts on this subject based on the ideXlab platform.
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the impact of commercial banks on Underwriting spreads evidence from three decades
Social Science Research Network, 2008Co-Authors: Dongcheol Kim, Darius Palia, Anthony SaundersAbstract:This paper examines the effect of commercial bank entry on Underwriting spreads for IPOs, SEOs, and debt issues using a long time series that spans 30 years, from 1975 to 2004. We find that, on average, commercial banks charge lower spreads of approximately 72 basis points for IPOs, 43 basis points for SEOs, and 14 basis points for debt over the entire sample period. The economic impact of commercial banks on lowering Underwriting spreads is most significant when commercial banks were allowed to enter via Section 20 subsidiaries but persists beyond. Commercial bank entry into Underwriting appears to have a procompetitive effect that lasts many years after their initial entry.
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bank entry competition and the market for corporate securities Underwriting
Social Science Research Network, 1999Co-Authors: Amar Gande, Manju Puri, Anthony SaundersAbstract:Commercial banks have been a relatively recent entrant into the corporate securities Underwriting market as a result of certain relaxations of the Glass-Steagall Act (especially Section 20 of the Act). The Congress and the academia have been debating the benefits and costs of allowing commercial banks to expand their non-bank activities, such as Underwriting corporate securities. This paper contributes to this debate by investigating the competitive effect of commercial bank entry into the corporate securities Underwriting market. It also compares and contrasts the effects in the debt Underwriting market, where banks have obtained an increasing market share with those in the equity Underwriting market, where banks have not yet made significant inroads. A key result of the paper is we find that underwriter spreads declined significantly with bank entry (after controlling for several issue characteristics, such as debt rating, issue size, maturity, industry etc.) in the corporate debt market, consistent with the market becoming more competitive. Further, we find that the reduction in debt underwriter spreads is strongest among lower-rated and smaller debt issues, with banks Underwriting a relatively larger proportion of such issues. Interestingly, we find that while Section 20 deregulation appears to have resulted in a significant decline in Underwriting spreads in the corporate bond market, similar declines are not apparent in equity markets, where banks have not yet made significant inroads. Our paper also investigates other competitive aspects of bank entry, such as ex-ante yields and market concentration, and documents a pro-competitive effect of commercial bank entry into the market for corporate securities Underwriting.
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bank Underwriting of debt securities modern evidence
Social Science Research Network, 1996Co-Authors: Amar Gande, Manju Puri, Anthony Saunders, Ingo WalterAbstract:This paper examines recent evidence on the characteristics and pricing of debt securities underwritten by Section 20 subsidiaries of U.S. commercial bank holding companies relative to those underwritten by investment houses. Our results show that Section 20 Underwritings of lower-credit rated firms in which the bank has a lending stake, results in relatively higher prices (lower yields). We find no evidence of conflicts of interest in situations where one would expect large conflicts ex-ante, e.g., where the purpose of the bank Underwriting is to repay existing bank debt. The results are generally consistent with the view that when banks underwrite debt securities of firms to which they lend (through their commercial banking affiliate) there is a net certification effect present. We also find that Section 20 subsidiaries bring a relatively larger proportion of smaller sized issues to the market than investment houses. Thus, contrary to the contention that greater universal banking powers will stunt the availability of finance to smaller firms we find support for the view that bank Underwriting is net beneficial to smaller firms.
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bank Underwriting of debt securities modern evidence
Research Papers in Economics, 1995Co-Authors: Amar Gande, Manju Puri, Anthony Saunders, Ingo WalterAbstract:This article examines debt securities underwritten by Section 20 subsidiaries of bank holding companies relative to those underwritten by investment houses. Consistent with a net certification effects for banks, bank Underwriting of lower credit rated firms to whom the bank lends results in relatively higher prices (lower yields). We find no evidence of conflicts of interest even when an issue is used to repay bank debt. Further, banks bring a relatively larger proportion of small issues to the market. Contrary to the contention that universal banking stunts availability of finance to small firms, bank Underwritings appear to benefit small firms. Article published by Oxford University Press on behalf of the Society for Financial Studies in its journal, The Review of Financial Studies.
Alexander Ljungqvist - One of the best experts on this subject based on the ideXlab platform.
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Competing for Securities Underwriting Mandates: Banking Relationships and Analyst Recommendations
The Journal of Finance, 2006Co-Authors: Alexander Ljungqvist, Felicia Marston, W J W Jr.Abstract:We investigate whether analyst behavior influenced banks' likelihood of winning Underwriting mandates for a sample of 16,625 U.S. debt and equity offerings in 1993-2002. We control for the strength of the issuer's investment banking relationships with potential competitors for the mandate, prior lending relationships, and the endogeneity of analyst behavior and the bank's decision to provide analyst coverage. Although analyst behavior was influenced by economic incentives, we find no evidence that aggressive analyst behavior increased their bank's probability of winning an Underwriting mandate. The main determinant of the lead-bank choice is the strength of prior Underwriting and lending relationships.
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competing for securities Underwriting mandates banking relationships and analyst recommendations
Social Science Research Network, 2003Co-Authors: Alexander Ljungqvist, Felicia C Marston, William J WilhelmAbstract:We investigate directly whether analyst behavior influenced the likelihood of banks winning Underwriting mandates for a sample of 16,625 U.S. debt and equity offerings sold between December 1993 and June 2002. We control for the strength of the issuer's investment-banking relationships with potential competitors for the mandate, prior lending relationships, and the endogeneity of analyst behavior and the bank's decision to provide analyst coverage. We find no evidence that aggressive analyst recommendations or recommendation upgrades increased their bank's probability of winning an Underwriting mandate after controlling for analysts' career concerns and bank reputation. Our findings might be interpreted as suggesting that bank and analyst credibility are central to resolving information frictions associated with securities offerings.
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competing for securities Underwriting mandates banking relationships and analyst recommendations
Research Papers in Economics, 2003Co-Authors: Alexander Ljungqvist, Felicia C Marston, William J WilhelmAbstract:We investigate directly whether analyst behaviour influenced the likelihood of banks winning Underwriting mandates for a sample of 16,625 US debt and equity offerings sold between December 1993 and June 2002. We control for the strength of the issuer’s investment-banking relationships with potential competitors for the mandate, prior lending relationships, and the endogeneity of analyst behaviour and the bank’s decision to provide analyst coverage. Contrary to recent allegations, we find no evidence that aggressive analyst recommendations or recommendation upgrades increased a bank’s probability of winning an Underwriting mandate once we control for analysts’ career concerns. In fact, the opposite appears to be the case. We interpret this finding as evidence that credibility is central to resolving information frictions associated with securities offerings. Overly aggressive analyst behaviour undermines credibility.
Michael Theobald - One of the best experts on this subject based on the ideXlab platform.
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rights offerings takeup renounceability and Underwriting status
Journal of Financial Economics, 2008Co-Authors: Balasingham Balachandran, Robert W Faff, Michael TheobaldAbstract:Rights offerings in Australia provide valuable choices to the issuer in terms of both Underwriting and renounceability. We formulate a set of hypotheses from a quality-signaling perspective, affording an analysis of the key interrelations between quality, Underwriting status, renounceability, takeup, and subscription price discount. We analyse rights offerings from two perspectives: market reaction to rights announcements and identification of the factors driving the choice of issue type. Evidence strongly supports the relation between quality signals and issue type. Using a robustly constructed takeup variable, we establish empirical relations between takeup, Underwriting status, and renounceability that differ significantly from those previously reported, but which are consistent with the hypotheses developed in this paper. © 2008 Elsevier B.V. All rights reserved.
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rights offerings takeup renounceability and Underwriting status
Social Science Research Network, 2007Co-Authors: Balasingham Balachandran, Robert W Faff, Michael TheobaldAbstract:Rights offerings in Australia provide valuable choices to the issuer in terms of both Underwriting and renounceability. We formulate a set of hypotheses from a quality-signalling perspective, affording an analysis of the key interrelations between quality, Underwriting status, renounceability, takeup, and subscription price discount. We analyse rights offerings from two perspectives: market reaction to rights announcements and identification of the factors driving the choice of issue type. Evidence strongly supports the relation between quality signals and issue type. Using a robustly constructed takeup variable, we establish empirical relations between takeup, Underwriting status, and renounceability that differ significantly from those previously reported, but which are consistent with the hypotheses developed in this paper.
Amar Gande - One of the best experts on this subject based on the ideXlab platform.
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bank entry competition and the market for corporate securities Underwriting
Social Science Research Network, 1999Co-Authors: Amar Gande, Manju Puri, Anthony SaundersAbstract:Commercial banks have been a relatively recent entrant into the corporate securities Underwriting market as a result of certain relaxations of the Glass-Steagall Act (especially Section 20 of the Act). The Congress and the academia have been debating the benefits and costs of allowing commercial banks to expand their non-bank activities, such as Underwriting corporate securities. This paper contributes to this debate by investigating the competitive effect of commercial bank entry into the corporate securities Underwriting market. It also compares and contrasts the effects in the debt Underwriting market, where banks have obtained an increasing market share with those in the equity Underwriting market, where banks have not yet made significant inroads. A key result of the paper is we find that underwriter spreads declined significantly with bank entry (after controlling for several issue characteristics, such as debt rating, issue size, maturity, industry etc.) in the corporate debt market, consistent with the market becoming more competitive. Further, we find that the reduction in debt underwriter spreads is strongest among lower-rated and smaller debt issues, with banks Underwriting a relatively larger proportion of such issues. Interestingly, we find that while Section 20 deregulation appears to have resulted in a significant decline in Underwriting spreads in the corporate bond market, similar declines are not apparent in equity markets, where banks have not yet made significant inroads. Our paper also investigates other competitive aspects of bank entry, such as ex-ante yields and market concentration, and documents a pro-competitive effect of commercial bank entry into the market for corporate securities Underwriting.
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bank Underwriting of debt securities modern evidence
Social Science Research Network, 1996Co-Authors: Amar Gande, Manju Puri, Anthony Saunders, Ingo WalterAbstract:This paper examines recent evidence on the characteristics and pricing of debt securities underwritten by Section 20 subsidiaries of U.S. commercial bank holding companies relative to those underwritten by investment houses. Our results show that Section 20 Underwritings of lower-credit rated firms in which the bank has a lending stake, results in relatively higher prices (lower yields). We find no evidence of conflicts of interest in situations where one would expect large conflicts ex-ante, e.g., where the purpose of the bank Underwriting is to repay existing bank debt. The results are generally consistent with the view that when banks underwrite debt securities of firms to which they lend (through their commercial banking affiliate) there is a net certification effect present. We also find that Section 20 subsidiaries bring a relatively larger proportion of smaller sized issues to the market than investment houses. Thus, contrary to the contention that greater universal banking powers will stunt the availability of finance to smaller firms we find support for the view that bank Underwriting is net beneficial to smaller firms.
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bank Underwriting of debt securities modern evidence
Research Papers in Economics, 1995Co-Authors: Amar Gande, Manju Puri, Anthony Saunders, Ingo WalterAbstract:This article examines debt securities underwritten by Section 20 subsidiaries of bank holding companies relative to those underwritten by investment houses. Consistent with a net certification effects for banks, bank Underwriting of lower credit rated firms to whom the bank lends results in relatively higher prices (lower yields). We find no evidence of conflicts of interest even when an issue is used to repay bank debt. Further, banks bring a relatively larger proportion of small issues to the market. Contrary to the contention that universal banking stunts availability of finance to small firms, bank Underwritings appear to benefit small firms. Article published by Oxford University Press on behalf of the Society for Financial Studies in its journal, The Review of Financial Studies.
