Atılgan, Yiğit and Ghosh, Aloke and Yan, Meng and Zhang, Jieying (2015) Cross-listed bonds, information asymmetry and conservatism in credit ratings. Journal of Money, Credit and Banking, 47 (5). pp. 897-929. ISSN 0022-2879 (Print) 1538-4616 (Online)
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Official URL: http://dx.doi.org/10.1111/jmcb.12232
Abstract
We propose information asymmetry as an additional explanation for rating conservatism. Because information asymmetry is likely higher for cross-listed bonds than for U.S. bonds, we expect and find that cross-listed bonds are rated more conservatively than U.S. domestic bonds at issuance. Further, cross-listed bonds receive less frequent upgrades and take longer to be upgraded after issuance. Because lower ratings might also reflect higher default risk based on
agencies’ private information, we conduct additional tests to discriminate between the rating conservatism and private information explanations. The results are consistent with ratings conservatism and inconsistent with the private information explanation.
Item Type: | Article |
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Uncontrolled Keywords: | cross-listed bonds; credit ratings; rating conservatism; cost of debt |
Subjects: | H Social Sciences > HG Finance > HG3810-4000 Foreign exchange. International finance H Social Sciences > HG Finance > HG1706-1708 Accounting. Bookkeeping |
Divisions: | Sabancı Business School Sabancı Business School > Accounting and Finance |
Depositing User: | Yiğit Atılgan |
Date Deposited: | 16 Dec 2015 15:54 |
Last Modified: | 26 Apr 2022 09:25 |
URI: | https://research.sabanciuniv.edu/id/eprint/27776 |
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Cross-listed bonds, information asymmetry and conservatism in credit ratings. (deposited 21 Nov 2014 22:56)
- Cross-listed bonds, information asymmetry and conservatism in credit ratings. (deposited 16 Dec 2015 15:54) [Currently Displayed]