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Equity pledge and debt financing of listed companies

Author

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  • Hu, Jing
  • Zhong, Lejia
  • Qiao, Jingyuan

Abstract

This paper selects the relevant data of listed companies from 2015 to 2021 to study the relationship and influence mechanism between equity pledge behavior and debt financing cost of listed companies. It is found that controlling shareholders' equity pledge behavior affects the debt financing cost of listed companies, which makes the financing cost of listed companies increase; equity pledge mainly affects the debt financing cost through the two paths of control transfer risk and information disclosure quality, which makes the debt financing cost increase, and the profit appropriation motive does not constitute the path of equity pledge affecting the debt financing cost.

Suggested Citation

  • Hu, Jing & Zhong, Lejia & Qiao, Jingyuan, 2024. "Equity pledge and debt financing of listed companies," Finance Research Letters, Elsevier, vol. 59(C).
    • Handle: RePEc:eee:finlet:v:59:y:2024:i:c:s1544612323011431
    DOI: 10.1016/j.frl.2023.104771
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    References listed on IDEAS

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    Cited by:

    1. Ji, Tuo & Cai, Dong, 2024. "Major shareholder equity pledge and litigation risk," Finance Research Letters, Elsevier, vol. 65(C).
    2. Fangjing Hao, 2024. "Insurance participation, equity pledge and stock price crash risk: Evidence from China," PLOS ONE, Public Library of Science, vol. 19(10), pages 1-33, October.
    3. Qiu, Yong & Guo, Ziyang & Li, Junlong & Li, Biao & Qiao, Dan, 2024. "Impact of controlling shareholders’ equity pledges on firms’ labour investment efficiency," Finance Research Letters, Elsevier, vol. 70(C).
    4. Ren, Haibo & Xu, Yueping & Wu, Jiangning, 2024. "Controlling shareholders' stock pledges and stock price crash risks," Finance Research Letters, Elsevier, vol. 68(C).

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