Debt Conservatism and Debt-Equity Choices: Evidence from REITs' Unused Debt Capacity
We infer debt conservatism behavior by examining how REITs adjust towards their debt capacity following a capital issue or repurchase decision. It is observed that REITs with high unused debt capacity tend to issue equity which renders them more underleveraged for at least two consecutive years. The...
Saved in:
| Main Author: | |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
UUM Press
2017
|
| Subjects: | |
| Online Access: | https://repo.uum.edu.my/id/eprint/29524/1/IJBF%2013%2001%202017%201-28.pdf https://repo.uum.edu.my/id/eprint/29524/ https://e-journal.uum.edu.my/index.php/ijbf/article/view/8496 |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| Institution: | Universiti Utara Malaysia |
| Language: | English |
| Summary: | We infer debt conservatism behavior by examining how REITs adjust towards their debt capacity following a capital issue or repurchase decision. It is observed that REITs with high unused debt capacity tend to issue equity which renders them more underleveraged for at least two consecutive years. These high debt buffer REITs also tend to converge slowly towards their debt capacity through repurchase decisions and hold significantly higher unused debt facilities than their low buffer counterparts. These findings are robust to a variety of robustness checks and cannot be explained by the traditional pecking order and trade-off theories of capital structure. |
|---|