Assessing the Influence of Standard & Poor's on Loan Syndication in the Financial Market | ||
| المجلة العلمية للدراسات والبحوث المالية والتجارية | ||
| Article 5, Volume 5, Issue 1, January 2024, Pages 31-68 PDF (1.25 M) | ||
| Document Type: المقالة الأصلية | ||
| DOI: 10.21608/cfdj.2024.324083 | ||
| Author | ||
| Mahmoud Ahmed | ||
| Sohag University | ||
| Abstract | ||
| This study aims to examine the relationship between a borrower's credit rating and the structure of a syndicated loan. A syndicated loan is a type of loan that is provided by a group of lenders, rather than just one. The study used data on 5,106 syndicated loans that were initiated between 1996 and 2017. The findings showed that borrowers with a higher credit rating were more likely to attract more lenders to provide financing. Additionally, when the borrower had a poor credit rating, the lead arranger (the bank that coordinates the syndicated loan) tended to hold a larger proportion of the loan compared to when the borrower had a good credit rating. Overall, the findings of this study indicate that the credit rating of a borrower can significantly influence the structure of a syndicated loan by reducing potential conflicts of interest between the lead banks and other participating lenders. | ||
| Keywords | ||
| credit rating; syndicated loan; information asymmetry; lead bank; participant bank | ||
|
Statistics Article View: 98 PDF Download: 168 |
||
