Do Credit Ratings Determine Capital Structure?

Amrit Judge, Anna Korzhenitskaya
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Abstract

Abstract This paper examines whether the possession of a credit rating has an impact on firms leverage ratio. The issue of access to alternative sources of debt finance has received special attention in the wake of 2007–2009 financial crisis when banks significantly cut back on loans and firms became credit-constrained. Consequently, policy makers have been examining ways of facilitating access to non-bank finance. An overreliance on bank sourced debt finance when credit markets tighten has the potential to slow down the speed of economic recovery. This paper provides empirical evidence in support of the hypothesis that the possession of a credit rating is associated with higher leverage ratios. The effect for UK firms seems higher than that observed for similar US firms. This might be because there is greater financial transparency in the US implying lower levels of information asymmetry and so negating somewhat the effects of possessing a rating.
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信用评级决定资本结构吗?
摘要本文研究了信用评级是否会对企业杠杆率产生影响。在2007-2009年金融危机之后,获得替代债务融资来源的问题受到了特别关注,当时银行大幅削减贷款,企业受到信贷限制。因此,政策制定者一直在研究促进获得非银行融资的途径。当信贷市场收紧时,过度依赖银行债务融资,有可能减缓经济复苏的速度。本文提供了实证证据,以支持拥有信用评级与较高杠杆率相关的假设。对英国公司的影响似乎高于对类似美国公司的影响。这可能是因为美国的金融透明度更高,意味着信息不对称程度更低,因此在某种程度上抵消了拥有评级的影响。
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来源期刊
CiteScore
2.60
自引率
8.30%
发文量
9
期刊介绍: International Journal of the Economics of Business presents original, peer reviewed research in economics that is clearly applicable to business or related public policy problems or issues. The term "business" is used in its widest sense to encompass both public and private sector—governmental, private non-profit and cooperative organizations, as well as profit-seeking enterprises. International Journal of the Economics of Business carries papers relating to three main spheres: The organization—to analyse and aid decision making and the internal organization of the business; The industry—to analyse how businesses interact and evolve within and across industries.
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