Eurobond underwriter spreads
AbstractWe examine the determinants of underwriter spreads on straight/fixed rate Eurobonds issued by US firms between 1990 and 1998. We find that underwriter spreads are influenced by: (i) the governing law as it influences the timely and orderly renegotiation of contract terms, with bonds governed by English law having significantly lower spreads; (ii) the distribution mechanism, with spreads higher on public issues than private placements; (iii) underwriter reputation, with more reputable underwriters charging higher spreads; and (iv) the choice of currency, with spreads higher in the less frequently used currencies and/or in currencies where underwriting activities are more concentrated. Copyright The Authors Journal compilation (c) 2006 AFAANZ.
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Bibliographic InfoArticle provided by Accounting and Finance Association of Australia and New Zealand in its journal Accounting and Finance.
Volume (Year): 46 (2006)
Issue (Month): 1 ()
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Other versions of this item:
- Neil Esho & Ian Sharpe, 2004. "Eurobond Underwriter Spreads," FMG Discussion Papers, Financial Markets Group dp503, Financial Markets Group.
- Neil Esho & Michael G. Kollo & Ian G. Sharpe, 2004. "Eurobond underwriter spreads," LSE Research Online Documents on Economics, London School of Economics and Political Science, LSE Library 24744, London School of Economics and Political Science, LSE Library.
- G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
- G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
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