The security lending market allows institutional investors, such as insurance companies, to lend out their holding assets in exchange for cash collateral, an important but understudied source of funding to conduct off-balance sheet transactions. Since these lenders are also primary investors of...

We study how the relative availability of bond and bank financing supply affects the firm's ability to borrow and to use its leverage to buffer shocks. We define a measure that proxies for the regional borrowing inflexibility in the availability of bank and bond financing: “debt...