التفاصيل البيبلوغرافية
| العنوان: |
The Rise of Covenant-Lite Bond Contracting. |
| المؤلفون: |
Gietzmann, Miles1 (AUTHOR) miles.gietzmann@unibocconi.it, Isidro, Helena2 (AUTHOR), Raonic, Ivana3 (AUTHOR) |
| المصدر: |
Journal of Accounting, Auditing & Finance. Jul2023, Vol. 38 Issue 3, p483-509. 27p. 9 Charts, 2 Graphs. |
| مصطلحات موضوعية: |
*JUNK bonds, *INVESTOR protection, *CONTRACTS, *PUBLIC debts, *DEBT, CREDIT spread |
| مستخلص: |
We investigate the trading and yield effects of covenant-lite (cov-lite) high-yield bond contracts, which have a restricted (lite) set of covenants. The excluded covenants often are those that use accounting performance measures. Although much research has focused on the potential benefits of accounting as a basis for debt contracting, little is known about settings where it may be optimal to exclude accounting performance statistics from public debt contracts. We find that cov-lite high-yield bonds have a higher trading turnover and lower yield spreads. Our findings provide empirical support for theory, which predicts, for optimal bond covenant design, that a trade-off between improving trading ease versus enhanced investor protection needs to be managed. These results enhance our understanding of the limits of accounting's role in (bond) contracting design. [ABSTRACT FROM AUTHOR] |
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| قاعدة البيانات: |
Business Source Index |
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