The role of dynamic renegotiation and asymmetric information in financial contracting

• 成果类型: Article
• 署名作者: Roberts, Michael R.
• 署名单位: University of Pennsylvania; National Bureau of Economic Research
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2014.11.013
• 发表日期: 2015
• 页码: 61-81
• 关键词: Renegotiation; FINANCIAL CONTRACTS; Control rights; asymmetric information

摘要

Using data from Securities and Exchange Commission filings, I show that the typical bank loan is renegotiated five times, or every nine months. The pricing, maturity, amount, and covenants are all significantly modified during each renegotiation, whose timing is governed by the financial health of the contracting parties and uncertainty regarding the borrowers' credit quality. The relative importance of these factors depends on the duration of the lending relationship. I interpret these results in light of financial contracting theories and emphasize that renegotiation is an important mechanism for dynamically completing contracts and for allocating control rights ex post. (C) 2014 Elsevier B.V. All rights reserved.