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We investigate the liquidity management of firms following the inception of credit default swaps (CDS) markets on their debt, which allow hedging and speculative trading on credit risk to be carried out by creditors and other parties. We find that reference firms hold more cash after CDS trading...
Persistent link: https://www.econbiz.de/10012965176
Credit default swaps (CDS) are derivative contracts that are widely used as tools for credit risk management. However, in recent years, concerns have been raised about whether CDS trading itself affects the credit risk of the reference entities. We use a unique, comprehensive sample covering CDS...
Persistent link: https://www.econbiz.de/10012905456
Concerns have been raised, especially since the global financial crisis, about whether trading in credit default swaps (CDS) increases the credit risk of the reference entities. This study examines this issue by quantifying the impact of CDS trading on the credit risk of firms. We use a unique,...
Persistent link: https://www.econbiz.de/10013091841
Concerns have been raised, especially since the global financial crisis, about whether trading in credit default swaps (CDS) increases the credit risk of the reference entities. We use a unique, comprehensive sample covering 901 CDS introductions on North American corporate issuers between June...
Persistent link: https://www.econbiz.de/10013113175
Persistent link: https://www.econbiz.de/10009683369
Can monetary stimulus boost corporate investment? We answer this question by studying ECB's 2011-2012 Longer-Term Refinancing Operations (LTROs), which provided cheap funding to Eurozone banks. We find that, relative to their non-Eurozone counterparts, Eurozone firms invested more after the...
Persistent link: https://www.econbiz.de/10011850404
Persistent link: https://www.econbiz.de/10012200984
Can monetary stimulus by central banks boost corporate investment? We answer this question by studying ECB's Longer-Term Refinancing Operations (LTROs), which provided cheap funding to Eurozone commercial banks to support the real sector. We find that, contrary to the intended result, firms...
Persistent link: https://www.econbiz.de/10012934680
Persistent link: https://www.econbiz.de/10014319918
Credit default swaps (CDS) have been growing in importance in the global financial markets. However, their role has been hotly debated, in industry and academia, particularly since the credit crisis of 2007-2009. We review the extant literature on CDS that has accumulated over the past two...
Persistent link: https://www.econbiz.de/10013031657