Advanced Search
MyIDEAS: Login

Debt Maturity Structure and the 1997 Asian Financial Crisis

Contents:

Author Info

  • Rataporn Deesomsak

    ()
    (Durham Business School)

  • Krishna Paudyal

    (Durham Business School)

  • Gioia Pescetto

    (Durham Business School)

Abstract

The paper investigates the effects of firm-specific and country-specific characteristics, and the 1997 Asian financial crisis on the debt maturity structure of firms in the Asia Pacific region. Given that the economies of the sample countries were at different stages of development and were affected by the 1997 Asian financial crisis by different degrees, the paper explores the effects of the crisis on debt maturity structure by grouping the sample countries according to the severity of the crisis. The results indicate that firms adjust their debt maturity structure to target level very quickly; the maturity structure decision of a firm is the product of both its own characteristics and the economic and institutional environment in which it operates. They also reveal that the crisis had significant effects on firm’s debt maturity structure and their determinants.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://dro.dur.ac.uk/10370
File Function: main text
Download Restriction: no

Bibliographic Info

Paper provided by Durham University Business School in its series Working Papers with number 2007_01.

as in new window
Length:
Date of creation: 20 Mar 2007
Date of revision:
Handle: RePEc:dur:durham:2007_01

Contact details of provider:
Postal: Durham University Business School, Mill Hill Lane, Durham DH1 3LB, England
Phone: +44 (0)191 334 5200
Fax: +44 (0)191 334 5201
Email:
Web page: http://www.dur.ac.uk/business
More information through EDIRC

Related research

Keywords: debt maturity structure; Asia Pacific region; financial crisis;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Hoyt Bleakley & Kevin Cowan, 2005. "Maturity Mismatch and Financial Crises: Evidence from Emerging Market Corporations," Research Department Publications 4433, Inter-American Development Bank, Research Department.
  2. Kraus, Alan, 1973. "The Bond Refunding Decision in an Efficient Market," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 8(05), pages 793-806, December.
  3. Deesomsak, Rataporn & Paudyal, Krishna & Pescetto, Gioia, 2004. "The determinants of capital structure: evidence from the Asia Pacific region," Journal of Multinational Financial Management, Elsevier, vol. 14(4-5), pages 387-405.
  4. Guedes, Jose & Opler, Tim, 1996. " The Determinants of the Maturity of Corporate Debt Issues," Journal of Finance, American Finance Association, vol. 51(5), pages 1809-33, December.
  5. M Arellano & O Bover, 1990. "Another Look at the Instrumental Variable Estimation of Error-Components Models," CEP Discussion Papers dp0007, Centre for Economic Performance, LSE.
  6. Kane, Alex & Marcus, Alan J. & McDonald, Robert L., 1985. "Debt Policy and the Rate of Return Premium to Leverage," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 20(04), pages 479-499, December.
  7. Rajan, Raghuram G & Zingales, Luigi, 1995. " What Do We Know about Capital Structure? Some Evidence from International Data," Journal of Finance, American Finance Association, vol. 50(5), pages 1421-60, December.
  8. Demirguc-Kunt, Asli & Maksimovic, Vojislav, 1999. "Institutions, financial markets, and firm debt maturity," Journal of Financial Economics, Elsevier, vol. 54(3), pages 295-336, December.
  9. Stewart C. Myers & Raghuram G. Rajan, 1995. "The Paradox of Liquidity," NBER Working Papers 5143, National Bureau of Economic Research, Inc.
  10. Altman, Edward I, 1984. " A Further Empirical Investigation of the Bankruptcy Cost Question," Journal of Finance, American Finance Association, vol. 39(4), pages 1067-89, September.
  11. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert W., 1998. "Law and Finance," Scholarly Articles 3451310, Harvard University Department of Economics.
  12. Arellano, Manuel & Bond, Stephen, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Wiley Blackwell, vol. 58(2), pages 277-97, April.
  13. Barclay, Michael J. & Marx, Leslie M. & Smith, Clifford Jr., 2003. "The joint determination of leverage and maturity," Journal of Corporate Finance, Elsevier, vol. 9(2), pages 149-167, March.
  14. Aydin Ozkan, 2000. "An empirical analysis of corporate debt maturity structure," European Financial Management, European Financial Management Association, vol. 6(2), pages 197-212.
  15. Malcolm Baker & Richard S. Ruback & Jeffrey Wurgler, 2004. "Behavioral Corporate Finance: A Survey," NBER Working Papers 10863, National Bureau of Economic Research, Inc.
  16. Joseph E. Stiglitz, 1972. "On the Irrelevance of Corporate Financial Policy," Cowles Foundation Discussion Papers 339, Cowles Foundation for Research in Economics, Yale University.
  17. Mishkin, Frederic S., 1999. "Lessons from the Asian crisis," Journal of International Money and Finance, Elsevier, vol. 18(4), pages 709-723, August.
  18. Barnea, Amir & Haugen, Robert A & Senbet, Lemma W, 1980. " A Rationale for Debt Maturity Structure and Call Provisions in the Agency Theoretic Framework," Journal of Finance, American Finance Association, vol. 35(5), pages 1223-34, December.
  19. Oliver Hart & John Moore, 1994. "Debt and Seniority: An Analysis of the Role of Hard Claims in Constraining Management," NBER Working Papers 4886, National Bureau of Economic Research, Inc.
  20. Barclay, Michael J & Smith, Clifford W, Jr, 1995. " The Maturity Structure of Corporate Debt," Journal of Finance, American Finance Association, vol. 50(2), pages 609-31, June.
  21. Titman, Sheridan & Wessels, Roberto, 1988. " The Determinants of Capital Structure Choice," Journal of Finance, American Finance Association, vol. 43(1), pages 1-19, March.
  22. Schmukler, Sergio L. & Vesperoni, Esteban, 2006. "Financial globalization and debt maturity in emerging economies," Journal of Development Economics, Elsevier, vol. 79(1), pages 183-207, February.
  23. Antoniou, Antonios & Guney, Yilmaz & Paudyal, Krishna, 2008. "The Determinants of Capital Structure: Capital Market-Oriented versus Bank-Oriented Institutions," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 43(01), pages 59-92, March.
  24. Antonios Antoniou & Yilmaz Guney & Krishna Paudyal, 2006. "The Determinants of Debt Maturity Structure: Evidence from France, Germany and the UK," European Financial Management, European Financial Management Association, vol. 12(2), pages 161-194.
  25. Brick, Ivan E. & Ravid, S. Abraham, 1991. "Interest Rate Uncertainty and the Optimal Debt Maturity Structure," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 26(01), pages 63-81, March.
  26. Chowdhry, Bhagwan & Goyal, Amit, 2000. "Understanding the financial crisis in Asia," Pacific-Basin Finance Journal, Elsevier, vol. 8(2), pages 135-152, May.
  27. Flannery, Mark J, 1986. " Asymmetric Information and Risky Debt Maturity Choice," Journal of Finance, American Finance Association, vol. 41(1), pages 19-37, March.
  28. Diamond, Douglas W., 1993. "Seniority and maturity of debt contracts," Journal of Financial Economics, Elsevier, vol. 33(3), pages 341-368, June.
  29. Frederick C. Scherr & Heather M. Hulburt, 2001. "The Debt Maturity Structure of Small Firms," Financial Management, Financial Management Association, vol. 30(1), Spring.
  30. Laurence Booth, 2001. "Capital Structures in Developing Countries," Journal of Finance, American Finance Association, vol. 56(1), pages 87-130, 02.
  31. Esho, Neil & Lam, Yung & Sharpe, Ian G., 2002. "Are maturity and debt type decisions interrelated? Evidence from Australian firms in international capital markets," Pacific-Basin Finance Journal, Elsevier, vol. 10(5), pages 549-569, November.
  32. Graham, John R. & Harvey, Campbell R., 2001. "The theory and practice of corporate finance: evidence from the field," Journal of Financial Economics, Elsevier, vol. 60(2-3), pages 187-243, May.
  33. Aydin Ozkan, 2002. "The determinants of corporate debt maturity: evidence from UK firms," Applied Financial Economics, Taylor & Francis Journals, vol. 12(1), pages 19-24.
  34. Sarkar, Sudipto, 1999. "Illiquidity Risk, Project Characteristics, and the Optimal Maturity of Corporate Debt," Journal of Financial Research, Southern Finance Association & Southwestern Finance Association, vol. 22(3), pages 353-70, Fall.
  35. Mitchell, Karlyn, 1991. "The Call, Sinking Fund, and Term-To-Maturity Features of Corporate Bonds: An Empirical Investigation," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 26(02), pages 201-222, June.
  36. Myers, Stewart C., 1977. "Determinants of corporate borrowing," Journal of Financial Economics, Elsevier, vol. 5(2), pages 147-175, November.
  37. Brick, Ivan E & Ravid, S Abraham, 1985. " On the Relevance of Debt Maturity Structure," Journal of Finance, American Finance Association, vol. 40(5), pages 1423-37, December.
  38. Diamond, Douglas W, 1991. "Debt Maturity Structure and Liquidity Risk," The Quarterly Journal of Economics, MIT Press, vol. 106(3), pages 709-37, August.
  39. Fan, Joseph P. H. & Wong, T. J., 2002. "Corporate ownership structure and the informativeness of accounting earnings in East Asia," Journal of Accounting and Economics, Elsevier, vol. 33(3), pages 401-425, August.
  40. Stohs, Mark Hoven & Mauer, David C, 1996. "The Determinants of Corporate Debt Maturity Structure," The Journal of Business, University of Chicago Press, vol. 69(3), pages 279-312, July.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Amanda E. Willsey & Dona Siregar, 2012. "The Effects Of The 2008-2009 Financial Crisis On U.S. Corporate Debt Structure," New York Economic Review, New York State Economics Association (NYSEA), vol. 43(1), pages 16-32.
  2. Diego Saravia, 2010. "Vulnerability, Crisis and Debt Maturity: do IMF Interventions Shorten the Length of Borrowing?," Working Papers Central Bank of Chile 600, Central Bank of Chile.
  3. Patricio Valenzuela, 2013. "Rollover risk and corporate bond spreads," Documentos de Trabajo 300, Centro de Economía Aplicada, Universidad de Chile.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:dur:durham:2007_01. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (IT Office).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.