Credit default swaps and shareholder monitoring
The paper examines how the initiation of credit default swaps (CDSs) influence the firm’s shareholder monitoring intensity. Prior studies have provided evidence that CDSs decrease lenders’ monitoring over the referenced firm (Morrison, 2005; Parlour and Winton, 2013). However, there is scant literat...
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| Format: | Thesis-Doctor of Philosophy |
| Language: | English |
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Nanyang Technological University
2022
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| Online Access: | https://hdl.handle.net/10356/156225 |
| _version_ | 1811687245259735040 |
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| author | Yu, Xiaoxu |
| author2 | Zhang Huai |
| author_facet | Zhang Huai Yu, Xiaoxu |
| author_sort | Yu, Xiaoxu |
| collection | NTU |
| description | The paper examines how the initiation of credit default swaps (CDSs) influence the firm’s shareholder monitoring intensity. Prior studies have provided evidence that CDSs decrease lenders’ monitoring over the referenced firm (Morrison, 2005; Parlour and Winton, 2013). However, there is scant literature on how shareholders react after the initiation of CDSs. Given that the reduced lenders’ monitoring could be detrimental to shareholders, I predict that shareholders will directly increase their monitoring intensity. Using a difference-in-differences design, I document that the shareholders’ monitoring intensity has significantly increased through director election voting and 13D filing after the initiation of CDSs. And the effect is concentrated on firms with higher firm risk, lower existing shareholders’ monitoring, and higher existing lenders’ monitoring. Collectively, the results provide direct evidence that shareholders indeed step in after firms’ CDSs initiation by enhancing their monitoring intensity. |
| first_indexed | 2024-10-01T05:13:15Z |
| format | Thesis-Doctor of Philosophy |
| id | ntu-10356/156225 |
| institution | Nanyang Technological University |
| language | English |
| last_indexed | 2024-10-01T05:13:15Z |
| publishDate | 2022 |
| publisher | Nanyang Technological University |
| record_format | dspace |
| spelling | ntu-10356/1562252024-01-12T10:18:45Z Credit default swaps and shareholder monitoring Yu, Xiaoxu Zhang Huai Nanyang Business School HuaiZhang@ntu.edu.sg Business::Accounting The paper examines how the initiation of credit default swaps (CDSs) influence the firm’s shareholder monitoring intensity. Prior studies have provided evidence that CDSs decrease lenders’ monitoring over the referenced firm (Morrison, 2005; Parlour and Winton, 2013). However, there is scant literature on how shareholders react after the initiation of CDSs. Given that the reduced lenders’ monitoring could be detrimental to shareholders, I predict that shareholders will directly increase their monitoring intensity. Using a difference-in-differences design, I document that the shareholders’ monitoring intensity has significantly increased through director election voting and 13D filing after the initiation of CDSs. And the effect is concentrated on firms with higher firm risk, lower existing shareholders’ monitoring, and higher existing lenders’ monitoring. Collectively, the results provide direct evidence that shareholders indeed step in after firms’ CDSs initiation by enhancing their monitoring intensity. Doctor of Philosophy 2022-04-07T12:38:31Z 2022-04-07T12:38:31Z 2022 Thesis-Doctor of Philosophy Yu, X. (2022). Credit default swaps and shareholder monitoring. Doctoral thesis, Nanyang Technological University, Singapore. https://hdl.handle.net/10356/156225 https://hdl.handle.net/10356/156225 10.32657/10356/156225 en This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License (CC BY-NC 4.0). application/pdf Nanyang Technological University |
| spellingShingle | Business::Accounting Yu, Xiaoxu Credit default swaps and shareholder monitoring |
| title | Credit default swaps and shareholder monitoring |
| title_full | Credit default swaps and shareholder monitoring |
| title_fullStr | Credit default swaps and shareholder monitoring |
| title_full_unstemmed | Credit default swaps and shareholder monitoring |
| title_short | Credit default swaps and shareholder monitoring |
| title_sort | credit default swaps and shareholder monitoring |
| topic | Business::Accounting |
| url | https://hdl.handle.net/10356/156225 |
| work_keys_str_mv | AT yuxiaoxu creditdefaultswapsandshareholdermonitoring |