Bank loan price reaction to dividend announcements: an empirical analysis of the secondary loan market

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dc.contributor.authorGonzalez Rodriguez, Karen Pamela
dc.contributor.authorUniversity of Lethbridge. Dhillon School of Business
dc.contributor.supervisorAsem, Ebenezer
dc.contributor.supervisorShao, Pei
dc.date.accessioned2019-06-06T17:35:26Z
dc.date.available2019-06-06T17:35:26Z
dc.date.issued2018
dc.degree.levelMastersen_US
dc.description.abstractIn this thesis, I examine the secondary loan price reaction to dividend announcements. Using a sample of loans from 254 US firms covering the period between 2000 and 2016, I find that loans are associated with significantly negative abnormal returns around dividend cut announcements, consistent with the information content hypothesis. In contrast, there are no abnormal returns around dividend increase announcements. Further analysis shows that the information content effect of dividend increases is offset by the wealth transfer effect. The results provide evidence that the information content and the wealth redistribution hypotheses are not mutually exclusive, and loan prices react according to the combination of both hypotheses. Additionally, empirical evidence indicates that cash holdings, monitoring incentives, the structure of debt contracts, and covenants can help mitigate the costs arising from agency conflicts.en_US
dc.embargoNoen_US
dc.identifier.urihttps://hdl.handle.net/10133/5389
dc.language.isoen_CAen_US
dc.proquest.subject0770en_US
dc.proquest.subject0508en_US
dc.proquestyesYesen_US
dc.publisherLethbridge, Alta. : University of Lethbridge, Dhillon School of Business
dc.publisher.facultyDhillon School of Businessen_US
dc.relation.ispartofseriesThesis (University of Lethbridge. Dhillon School of Business)
dc.subjectdividend changes
dc.subjectfinancial contracting
dc.subjectinformation content
dc.subjectsecondary loan market
dc.subjectwealth redistribution
dc.subject.lcshSecondary markets
dc.subject.lcshDividends
dc.subject.lcshBank loans
dc.subject.lcshBusiness communication
dc.subject.lcshDissertations, Academic
dc.titleBank loan price reaction to dividend announcements: an empirical analysis of the secondary loan marketen_US
dc.typeThesisen_US
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