Debt heterogeneity and covenants

Debt heterogeneity and covenants

Coordination failure among owners of heterogeneous debt types increases distress costs. Covenants reduce expected distress costs by lowering the probability of liquidity shortages, increasing liquidation values, and incentivizing creditor monitoring. We predict and find that new debt contracts inclu...

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Bibliographic Details
Main Authors: LOU, Yun, OTTO, Clemens A.
Format: text
Language:English
Published: Institutional Knowledge at Singapore Management University 2018
Subjects:
Debt Heterogeneity
Debt Covenants
Creditor Conflicts
Coordination Failure
Corporate Finance
Finance and Financial Management
Online Access:https://ink.library.smu.edu.sg/soa_research/1754
https://ink.library.smu.edu.sg/context/soa_research/article/2781/viewcontent/SSRN_id2297804.pdf
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Institution: Singapore Management University
Language: English

Internet

https://ink.library.smu.edu.sg/soa_research/1754
https://ink.library.smu.edu.sg/context/soa_research/article/2781/viewcontent/SSRN_id2297804.pdf

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