Networking Behind the Scenes: Institutional Cross-Industry Holdings and Corporate Loan Markets

Published Online:https://doi.org/10.1287/mnsc.2023.4911

References

  • Abramova I, Core JE, Sutherland A (2020) Institutional investor attention and firm disclosure. Accounting Rev. 95(6):1–21.CrossrefGoogle Scholar
  • Acharya VV, Johnson TC (2007) Insider trading in credit derivatives. J. Financial Econom. 84(1):110–141.CrossrefGoogle Scholar
  • Agarwal S, Hauswald R (2010) Distance and private information in lending. Rev. Financial Stud. 23(7):2757–2788.CrossrefGoogle Scholar
  • Agarwal S, Qian W, Reeb DM, Sing TF (2016) Playing the boys game: Golf buddies and board diversity. Amer. Econom. Rev. 106(5):272–276.CrossrefGoogle Scholar
  • Aghion P, Van Reenen J, Zingales L (2013) Innovation and institutional ownership. Amer. Econom. Rev. 103(1):277–304.CrossrefGoogle Scholar
  • Antón M, Ederer F, Giné M, Schmalz MC (2023) Common ownership, competition, and top management incentives. J. Political Econom. 131(5):1294–1355.CrossrefGoogle Scholar
  • Appel IR, Gormley TA, Keim DB (2016) Passive investors, not passive owners. J. Financial Econom. 121(1):111–141.CrossrefGoogle Scholar
  • Ayers BC, Ramalingegowda S, Eric Yeung P (2011) Hometown advantage: The effects of monitoring institution location on financial reporting discretion. J. Accounting Econom. 52(1):41–61.CrossrefGoogle Scholar
  • Azar J, Schmalz MC, Tecu I (2018) Anticompetitive effects of common ownership. J. Finance 73(4):1513–1565.CrossrefGoogle Scholar
  • Becht M, Franks J, Wagner HF (2021) The benefits of access: Evidence from private meetings with portfolio firms. Working paper, Université Libre de Bruxelles, Brussels, Belgium.Google Scholar
  • Becker B, Ivashina V (2014) Cyclicality of credit supply: Firm level evidence. J. Monetary Econom. 62(1):76–93.CrossrefGoogle Scholar
  • Berg T, Saunders A, Steffen S (2016) The total cost of corporate borrowing in the loan market: Don’t ignore the fees. J. Finance 71(3):1357–1392.CrossrefGoogle Scholar
  • Bharath ST, Dahiya S, Saunders A, Srinivasan A (2011) Lending relationships and loan contract terms. Rev. Financial Stud. 24(4):1141–1203.CrossrefGoogle Scholar
  • Bodnaruk A, Rossi M (2016) Dual ownership, returns, and voting in mergers. J. Financial Econom. 120(1):58–80.CrossrefGoogle Scholar
  • Botsch M, Vanasco V (2019) Learning by lending. J. Financial Intermediary 37(1):1–14.CrossrefGoogle Scholar
  • Bushee BJ (1998) The influence of institutional investors on myopic R&D investment behavior. Accounting Rev. 73(3):305–333.CrossrefGoogle Scholar
  • Bushman R, Gao J, Martin X, Pacelli J (2021) The influence of loan officers on loan contract design and performance. J. Accounting Econom. 71(2–3):101384.CrossrefGoogle Scholar
  • Bushman RM, Smith AJ, Wittenberg‐Moerman R (2010) Price discovery and dissemination of private information by loan syndicate participants. J. Accounting Res. 48(5):921–972.CrossrefGoogle Scholar
  • Cai Y, Sevilir M (2012) Board connections and M&A transactions. J. Financial Econom. 103(2):327–349.CrossrefGoogle Scholar
  • Cai Y, Kim Y, Park JC, White HD (2016) Common auditors in M&A transactions. J. Accounting Econom. 61(1):77–99.CrossrefGoogle Scholar
  • Campello M, Gao J (2017) Customer concentration and loan contract terms. J. Financial Econom. 123(1):108–136.CrossrefGoogle Scholar
  • Carrizosa R, Ryan SG (2017) Borrower private information covenants and loan contract monitoring. J. Accounting Econom. 64(2–3):313–339.CrossrefGoogle Scholar
  • Carvalho DR, Gao J, Ma P (2023) Loan spreads and credit cycles: The role of lenders’ personal economic experiences. J. Financial Econom. 148(2):118–149.CrossrefGoogle Scholar
  • Chava S, Roberts MR (2008) How does financing impact investment? The role of debt covenants. J. Finance 63(5):2085–2121.CrossrefGoogle Scholar
  • Chava S, Wang R, Zou H (2019) Covenants, creditors’ simultaneous equity holdings, and firm investment. J. Financial Quant. Anal. 54(2):481–512.CrossrefGoogle Scholar
  • Chen X, Harford J, Li K (2007) Monitoring: Which institutions matter? J. Financial Econom. 86(2):279–305.CrossrefGoogle Scholar
  • Chu Y (2018) Shareholder-creditor conflict and payout policy: Evidence from mergers between lenders and shareholders. Rev. Financial Stud. 31(8):3098–3121.CrossrefGoogle Scholar
  • Demerjian PR, Owens EL (2016) Measuring the probability of financial covenant violation in private debt contracts. J. Accounting Econom. 61(2–3):433–447.CrossrefGoogle Scholar
  • Dennis P, Gerardi K, Schenone C (2022) Common ownership does not have anti-competitive effects in the airline industry. J. Finance 77(5):2765–2798.CrossrefGoogle Scholar
  • Drucker S, Puri M (2005) On the benefits of concurrent lending and underwriting. J. Finance 60(6):2763–2799.CrossrefGoogle Scholar
  • Engelberg J, Gao P, Parsons CA (2012) Friends with money. J. Financial Econom. 103(1):169–188.CrossrefGoogle Scholar
  • Erel I (2011) The effect of bank mergers on loan prices: Evidence from the United States. Rev. Financial Stud. 24(4):1068–1101.CrossrefGoogle Scholar
  • Faccio M, Marchica M-T, Mura R (2011) Large shareholder diversification and corporate risk-taking. Rev. Financial Stud. 24(11):3601–3641.CrossrefGoogle Scholar
  • Ferreira MA, Matos P (2012) Universal banks and corporate control: Evidence from the global syndicated loan market. Rev. Financial Stud. 25(9):2703–2744.CrossrefGoogle Scholar
  • Frattaroli M, Herpfer C (2023) Information intermediaries: How commercial bankers facilitate strategic alliances. J. Financial Quant. Anal. 58(2):543–573.CrossrefGoogle Scholar
  • Freeman K (2016) The effects of common ownership on customer-supplier relationships. Working paper, Indiana University, Bloomington, IN.Google Scholar
  • Gilje EP, Gormley TA, Levit D (2020) Who’s paying attention? Measuring common ownership and its impact on managerial incentives. J. Financial Econom. 137(1):152–178.CrossrefGoogle Scholar
  • Gillan SL, Starks LT (2000) Corporate governance proposals and shareholder activism: The role of institutional investors. J. Financial Econom. 57(2):275–305.CrossrefGoogle Scholar
  • Gustafson MT, Ivanov IT, Meisenzahl RR (2021) Bank monitoring: Evidence from syndicated loans. J. Financial Econom. 139(2):452–477.CrossrefGoogle Scholar
  • Hale G, Santos JAC (2009) Do banks price their informational monopoly? J. Financial Econom. 93(2):185–206.CrossrefGoogle Scholar
  • Hansen RG, Lott JR (1996) Externalities and corporate objectives in a world with diversified shareholder/consumers. J. Financial Quant. Anal. 31(1):43–68.CrossrefGoogle Scholar
  • Harford J, Jenter D, Li K (2011) Institutional cross-holdings and their effect on acquisition decisions. J. Financial Econom. 99(1):27–39.CrossrefGoogle Scholar
  • Hartzell JC, Starks LT (2003) Institutional investors and executive compensation. J. Finance 58(6):2351–2374.CrossrefGoogle Scholar
  • Hasan I, Ramirez GG, Zhang G (2019) Lock-in effects in relationship lending: Evidence from DIP loans. J. Money Credit Bank. 51(4):1021–1043.CrossrefGoogle Scholar
  • He J, Huang J (2017) Product market competition in a world of cross-ownership: Evidence from institutional blockholdings. Rev. Financial Stud. 30(8):2674–2718.CrossrefGoogle Scholar
  • He J, Huang J, Zhao S (2019) Internalizing governance externalities: The role of institutional cross-ownership. J. Financial Econom. 134(2):400–418.CrossrefGoogle Scholar
  • He J, Li L, Yeung EP (2018) Two tales of monitoring: Effects of institutional cross-blockholding on accruals. Working paper, University of Georgia, Athens, GA.Google Scholar
  • He J, Tian X (2013) The dark side of analyst coverage: The case of innovation. J. Financial Econom. 109(3):856–878.CrossrefGoogle Scholar
  • Hellmann T, Lindsey L, Puri M (2008) Building relationships early: Banks in venture capital. Rev. Financial Stud. 21(2):513–541.CrossrefGoogle Scholar
  • Herpfer C (2021) The role of bankers in the US syndicated loan market. J. Accounting Econom. 71(2–3):101383.CrossrefGoogle Scholar
  • Hong H, Kacperczyk M (2010) Competition and bias. Quart. J. Econom. 125(4):1683–1725.CrossrefGoogle Scholar
  • Hong H, Kubik JD, Stein JC (2004) Social interaction and stock‐market participation. J. Finance 59(1):137–163.CrossrefGoogle Scholar
  • Houston J, James C (1996) Bank information monopolies and the mix of private and public debt claims. J. Finance 51(5):1863–1889.CrossrefGoogle Scholar
  • Huang J (2014) Shareholder coordination, corporate governance, and firm value. Working paper, University of Illinois Urbana-Champaign, Champaign, IL.Google Scholar
  • Ioannidou V, Ongena S (2010) “Time for a change”: Loan conditions and bank behavior when firms switch banks. J. Finance 65(5):1847–1877.CrossrefGoogle Scholar
  • Ivashina V (2009) Asymmetric information effects on loan spreads. J. Financial Econom. 92(2):300–319.CrossrefGoogle Scholar
  • Ivashina V, Sun Z (2011) Institutional stock trading on loan market information. J. Financial Econom. 100(2):284–303.CrossrefGoogle Scholar
  • Jayaraman N, Khorana A, Nelling E (2002) An analysis of the determinants and shareholder wealth effects of mutual fund mergers. J. Finance 57(3):1521–1551.CrossrefGoogle Scholar
  • Jiang W, Li K, Shao P (2010) When shareholders are creditors: Effects of the simultaneous holding of equity and debt by non-commercial banking institutions. Rev. Financial Stud. 23(10):3595–3637.CrossrefGoogle Scholar
  • John K, Qi Q, Wang J (2020) Bank integration and the market for corporate control: Evidence from cross-state acquisitions. Management Sci. 66(7):3277–3294.LinkGoogle Scholar
  • Jung MJ (2013) Investor overlap and diffusion of disclosure practices. Rev. Accounting Stud. 18(1):167–206.CrossrefGoogle Scholar
  • Kacperczyk M, Sialm C, Zheng L (2005) On the industry concentration of actively managed equity mutual funds. J. Finance 60(4):1983–2012.CrossrefGoogle Scholar
  • Kelly B, Ljungqvist A (2012) Testing asymmetric-information asset pricing models. Rev. Financial Stud. 25(5):1366–1413.CrossrefGoogle Scholar
  • Koch A, Panayides MA, Thomas S (2021) Common ownership and competition in product markets. J. Financial Econom. 139(1):109–137.CrossrefGoogle Scholar
  • Kwon HJ (2016) Executive compensation under common ownership. Working paper, University of Chicago, Chicago.Google Scholar
  • Lewellen K, Lowry M (2021) Does common ownership really increase firm coordination? J. Financial Econom. 141(1):322–344.CrossrefGoogle Scholar
  • Liang L (2016) Common ownership and executive compensation. Working paper, University of Texas at Dallas, Richardson, TX.Google Scholar
  • Liberti JM, Petersen MA (2019) Information: Hard and soft. Rev. Corporate Finance Stud. 8(1):1–41.CrossrefGoogle Scholar
  • Lin C, Ma Y, Malatesta P, Xuan Y (2011) Ownership structure and the cost of corporate borrowing. J. Financial Econom. 100(1):1–23.CrossrefGoogle Scholar
  • Lin C, Ma Y, Malatesta P, Xuan Y (2012) Corporate ownership structure and bank loan syndicate structure. J. Financial Econom. 104(1):1–22.CrossrefGoogle Scholar
  • Lin C, Ma Y, Malatesta P, Xuan Y (2013) Corporate ownership structure and the choice between bank debt and public debt. J. Financial Econom. 109(2):517–534.CrossrefGoogle Scholar
  • Matvos G, Ostrovsky M (2008) Cross-ownership, returns, and voting in mergers. J. Financial Econom. 89(3):391–403.CrossrefGoogle Scholar
  • Morgan AG, Poulsen AB (2001) Linking pay to performance-compensation proposals in the S&P 500. J. Financial Econom. 62(3):489–523.CrossrefGoogle Scholar
  • Murfin J (2012) The supply-side determinants of loan contract strictness. J. Finance 67(5):1565–1601.CrossrefGoogle Scholar
  • Ojeda W (2019) Common ownership in the loan market. Working paper, University of California, Berkeley, CA.Google Scholar
  • Park J, Sani J, Shroff N, White H (2019) Disclosure incentives when competing firms have common ownership. J. Accounting Econom. 67(2–3):387–415.CrossrefGoogle Scholar
  • Pawliczek A, Skinner NA, Zechman SLC (2022) Facilitating tacit collusion: A new perspective on common ownership and voluntary disclosure. J. Accounting Res. 60(5):1651–1693.CrossrefGoogle Scholar
  • Petersen MA, Rajan RG (1994) The benefits of lending relationships: Evidence from small business data. J. Finance 49(1):3–37.CrossrefGoogle Scholar
  • Pool VK, Stoffman N, Yonker SE (2012) No place like home: Familiarity in mutual fund manager portfolio choice. Rev. Financial Stud. 25(8):2563–2599.CrossrefGoogle Scholar
  • Pool VK, Stoffman N, Yonker SE (2015) The people in your neighborhood: Social interactions and mutual fund portfolios. J. Finance 70(6):2679–2732.CrossrefGoogle Scholar
  • Rajan RG (1992) Insiders and outsiders: The choice between informed and arm’s‐length debt. J. Finance 47(4):1367–1400.CrossrefGoogle Scholar
  • Rosenbaum PR, Rubin DB (1983) The central role of the propensity score in observational studies for causal effects. Biometrics 70(1):41–55.CrossrefGoogle Scholar
  • Ross DG (2010) The “dominant bank effect:” How high lender reputation affects the information content and terms of bank loans. Rev. Financial Stud. 23(7):2730–2756.CrossrefGoogle Scholar
  • Saidi F, Streitz D (2021) Bank concentration and product market competition. Rev. Financial Stud. 34(10):4999–5035.CrossrefGoogle Scholar
  • Santos JAC, Winton A (2008) Bank loans, bonds, and information monopolies across the business cycle. J. Finance 63(3):1315–1359.CrossrefGoogle Scholar
  • Schenone C (2010) Lending relationships and information rents: Do banks exploit their information advantages. Rev. Financial Stud. 23(3):1149–1199.CrossrefGoogle Scholar
  • Sharpe SA (1990) Asymmetric information, bank lending, and implicit contracts: A stylized model of customer relationships. J. Finance 45(4):1069–1087.Google Scholar
  • Shekita N (2022) Interventions by common owners. J. Competing Law Econom. 18(1):99–134.CrossrefGoogle Scholar
  • Stein JC (2002) Information production and capital allocation: Decentralized vs. hierarchical firms. J. Finance 57(5):1891–1921.CrossrefGoogle Scholar
  • Sufi A (2007) Information asymmetry and financing arrangements: Evidence from syndicated loans. J. Finance 62(2):629–668.CrossrefGoogle Scholar
  • Wang J, Wang L (2022) When shareholders cross-hold lenders’ equity: The effects on loan terms. Working paper, University of Missouri, Columbia, MO.Google Scholar
  • Yang H (2021) Institutional dual holdings and risk shifting: Evidence from corporate innovation. J. Corporate Finance 70(1):102088.CrossrefGoogle Scholar
INFORMS site uses cookies to store information on your computer. Some are essential to make our site work; Others help us improve the user experience. By using this site, you consent to the placement of these cookies. Please read our Privacy Statement to learn more.