the response of the external finance premium in asian corporate bond markets to financial characteristics, financial constraints and two financial crises文档.pdfVIP

Journal of Banking Finance 36 (2012) 3048–3059 Contents lists available at SciVerse ScienceDirect Journal of Banking Finance journal homepage: www.else /locate/jbf The response of the external finance premium in Asian corporate bond markets to financial characteristics, financial constraints and two financial crises Paul Mizen a, Serafeim Tsoukas b,⇑ a School of Economics, University of Nottingham, Nottingham NG7 2RD, UK b Department of Economics, University of Glasgow, Glasgow G12 8RT, UK a r t i c l e i n f o a b s t r a c t Article history: Empirical investigation of the external finance premium has been conducted on the margin between Received 31 January 2012 internal finance and bank borrowing or equities but little attention has been given to corporate bonds, Accepted 3 July 2012 especially for the emerging Asian market. In this paper, we hypothesize that balance sheet indicators Available online 13 July 2012 of creditworthiness could affect the external finance premium for bonds as they do for premia in other markets. Using bond-specific and firm-specific data for China, Hong Kong, Indonesia, Korea, Philippines, JEL classification: Singapore and Thailand during 1995–2009 we find that firms with better financial health face lower E22 external finance premia in all countries. When we introduce firm-level heterogeneity, we show