We study how debt market frictions constraining the ability to replace bank with bond financing during a tightening in bank credit supply affect corporate yield spreads. We document that more inflexible firms suffer bigger increases in bond yield spreads as bank credit supply tightens. Debt...

We study the relation between information and fire sales during a crisis. We argue that the reinforcing effect of funding liquidity on market liquidity is weaker when investors have more information about the assets facing sudden price drops (Brunnermeier and Pedersen, 2009). We focus on the...

We relate the firm legal structure to the degree of credit advantage of the headquarters. We argue that subsidiary-based firms are born as the outcome of a process of agglomeration around firms with better credit advantage. Therefore, subsidiary based firms have better credit advantage than...

We study how information flows within international financial conglomerates and how such a flow reduces the transmission of liquidity crisis due to fire-sales. We focus on the role of international institutional investors affiliated with banks during the 2008-2009 global financial crisis. We...

We study the effect of investment horizon clienteles on the IPO market. We start from the premise – that we support with evidence – that IPO stocks are very liquid in the after-market. Therefore, short-term investors should have a higher reservation price for them than long-term investors....

We study the conglomerate discount from a novel perspective. We argue that the discount – measured in terms of Tobin's Q – far from being a sign of lower value is, instead, a sign of higher value for the conglomerate. This can be explained as conglomerates being less financially constrained...

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...