We use unique features of the private credit market to examine whether currency risk is a priced systematic risk at the firm level and, therefore, whether and how it affects firms’ financing. We find that currency exposure has a large impact on loan spreads. Decomposing loan spreads, we find...

Using Roberts (2015) loan-level data from 2000 to 2011, we find that the inception of CDS trading on reference firms' debt is associated with a decreased number and lower probability of amendments, restatements, and rollovers to existing lenders of bank loans. Reference firms are also less...

We examine the effect of credit default swaps (CDS) trading on debt specialization. We argue that reference firms in CDS contracts exhibit higher debt concentration in comparison to firms that do not have CDS traded on them as a way to minimize creditor conflicts and costs in bankruptcy. Our...