Do Bank-Affiliated Analysts Benefit from Lending Relationships?

• 成果类型: Article
• 署名作者: Chen, Ting; Martin, Xiumin
• 署名单位: City University of New York (CUNY) System; Baruch College (CUNY); Washington University (WUSTL)
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/j.1475-679X.2011.00399.x
• 发表日期: 2011
• 页码: 633-675
• 关键词: CONFLICT-OF-INTEREST; FORECAST ACCURACY; INFORMATION; debt; INVESTMENT; credit; CHOICE; IMPACT; FIRMS

摘要

This paper investigates whether private information from lending activities improves the forecast accuracy of bank-affiliated analysts. Using a matched sample design, matching by affiliated bank or borrower, we demonstrate that the forecast accuracy of bank-affiliated analysts increases after the followed firm borrows from the affiliated bank. We also find that the increase in forecast accuracy is more pronounced for borrowers with greater information asymmetry and bad news, and for deals with financial covenants. Last, we find that the informational advantage of bank-affiliated analysts exists only when the affiliated banks serve as lead arrangers, not merely as participating lenders. Overall, our evidence suggests that information flows from commercial banking to equity research divisions within financial conglomerates.