How banks price loans for LBOs: an empirical analysis of spread determinants

Resultado de pesquisarevisão de pares

1 Citação (Scopus)
13 Transferências (Pure)


This paper examines which factors determine the pricing of loans for LBOs, using a worldwide sample of 11,111 loans closed in the 2000–2016 period. Our findings are consistent with the hypotheses that loans for LBOs extended to borrowers in market- versus bank-based financial systems are differently priced, and that law and institutional characteristics are important determinants of spreads for deals closed in market-oriented countries. Despite LBO loan pricing differing significantly in normal versus crisis times, loans extended to borrowers in market-based financial systems have higher spreads than those where banks play a major role. Our results also support the hypothesis of tranching as a mechanism of reducing spreads by completing financial markets and mitigating informational asymmetries. Finally, a robust convex relationship between spread and maturity is found, suggesting higher market competition by banks and investors for standard, medium-term maturities.
Idioma originalEnglish
RevistaJournal of Financial Services Research
Estado da publicaçãoAccepted/In press - 2021

Impressão digital

Mergulhe nos tópicos de investigação de “How banks price loans for LBOs: an empirical analysis of spread determinants“. Em conjunto formam uma impressão digital única.