Does it pay to be loyal? An empirical analysis of underwriting relationships and fees

• 成果类型: Article
• 署名作者: Burch, TR; Nanda, V; Warther, V
• 署名单位: University of Miami; University of Michigan System; University of Michigan
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2004.08.007
• 发表日期: 2005
• 页码: 673-699
• 关键词: underwriting; relationship capital; firm loyalty; seasoned offers

摘要

We examine underwriting fees for repeat issuers of new securities to determine the relation between loyalty to an underwriting bank and the fees charged. For a sample of offers over the 1975-2001 period, we find that loyalty is associated with lower fees for common stock offers, consistent with valuable relationship capital being built through loyalty. For debt offers, however, we find the opposite pattern, consistent with relationship capital not being as valuable. For both offer types, firms that graduate to higher-quality banks face lower fees. Firms that are more likely to be switching banks to improve analyst coverage face higher fees for common stock offers, but not for debt offers. (c) 2005 Elsevier B.V. All rights reserved.