Debts - Publications - Faculty & Research

20 May 2014
First Look

First Look: May 20

developing countries considering both creditor and debtor side of the international debt transactions. Using these measures, we demonstrate that sovereign-to-sovereign transactions account for upstream capital flows and global imbalances.... View Details

Keywords: Sean Silverthorne

03 Jul 2018
First Look

New Research and Ideas, July 3, 2018

forthcoming IMF Economic Review Debt Redemption and Reserve Accumulation By: Alfaro, Laura, and Fabio Kanczuk Abstract—In the past decade, foreign participation in local-currency bond markets in emerging countries increased dramatically.... View Details

Keywords: Dina Gerdeman

April 1999 (Revised March 2001)
Case

Be Our Guest, Inc.

By: Dwight B. Crane and Penny Joseph

Be Our Guest is a rapidly growing equipment rental company with substantial seasonality in its revenues and profits. In the spring of 1998, the senior management team is reviewing its financial plans in preparation for a meeting with the company's bank. The case... View Details

Keywords: Financial Strategy; Borrowing and Debt; Banks and Banking; Revenue; Management Teams; Business Plan; Forecasting and Prediction; Utilities Industry; Service Industry

Citation

Educators

Purchase

July 2009 (Revised July 2009)
Case

Delphi Corp. and the Credit Derivatives Market (A)

By: Stuart C. Gilson, Victoria Ivashina and Sarah Abbott

In 2005, Jane Bauer-Martin, a hedge fund manager, is considering what she should do with the fund's large investment in the publicly traded bonds of Delphi Corp., a financially troubled auto parts supplier. Delphi is General Motor's key auto parts supplier, and, like... View Details

Keywords: Borrowing and Debt; Insolvency and Bankruptcy; Credit Derivatives and Swaps; Bonds; Financial Management; Risk Management

Citation

Educators

Purchase

2010
Working Paper

Banking Market Concentration and Consumer Credit Constraints: Evidence from the 1983 Survey of Consumer Finances

This paper uses data from the 1983 Survey of Consumer Finances to test the relationship between the banks' market power and households' self-reported levels of credit constraints. The 1983 Survey was the last to identify households' geographic location, making it... View Details

Keywords: Age Characteristics; Household Characteristics; Borrowing and Debt; Credit; Banks and Banking; Interest Rates; Geographic Location; Banking Industry

Citation

Read Now

25 Sep 2007
First Look

First Look: September 25, 2007

cash-flow implications of a venture debt loan, and assess how much additional "runway" (months till cash runs out) the venture debt will provide. Students must also look at the prospective returns... View Details

Keywords: Martha Lagace

April 2011
Teaching Note

The Euro in Crisis: Decision Time at the European Central Bank (TN)

By: J. Gunnar Trumbull, Dante Roscini and Diane Choi

Teaching Note for 711049. View Details

Keywords: Currency; Central Banking; Borrowing and Debt; Decisions; Banking Industry

Citation

Purchase

December 2008 (Revised March 2009)
Case

Rosetree Mortgage Opportunity Fund

By: Victoria Ivashina and Andre F. Perold

In December 2008, in the midst of the worst financial crisis since the Great Depression, Rosetree Capital Management was evaluating the purchase of a pool of U.S. residential mortgages. The firm had formed an investment vehicle to acquire troubled residential mortgages... View Details

Keywords: Financial Crisis; Borrowing and Debt; Mortgages; Investment; Housing; Valuation; United States

Citation

Educators

Purchase

28 Mar 2018
Research & Ideas

Sophisticated Investors May Be Harming Fintech Lending Platforms

Zeng found, is the amount of information available about loan applicants. When platforms share a lot of information about applicants with potential investors—data such as income, debt level, and credit history, and even whether the loan... View Details

Keywords: by Dina Gerdeman; Banking; Financial Services

28 Aug 2014
Op-Ed

Government Can Do More to Unfreeze Small Business Credit

and expanded the Regulation A "mini-public offering" cap from $5 million to $50 million. On the debt side, over the past few years programs at the SBA and other loan guarantee agencies, including the US Department of Agriculture, have... View Details

Keywords: by Karen Mills; Banking

13 Jun 2012
HBS Case

HBS Cases: A Startup Takes On the Credit Ratings Giants

investment decisions; fund managers employ them when describing the contents and risks of their bond portfolios; market makers use them to set debt prices. In addition, they're part of the regulatory processes of big banks. Given that the... View Details

Keywords: by Maggie Starvish; Banking; Financial Services

08 Oct 2012
Research & Ideas

The Immigrants Who Built America’s Financial System

As today's fiscal deficit and dragging economy continue to cast long shadows, it's easy to forget much darker times in American history. Shortly after winning its independence from Great Britain, the United States was bankrupt. Individual states weren't required to... View Details

Keywords: by Julia Hanna; Financial Services; Banking

15 Jun 2010
First Look

First Look: June 15

identifying the effects of bank credit supply. First, we focus on firms' choice between two close forms of external financing: bank debt and public bonds. By conditioning the sample of firms raising new debt, we can rule out a demand... View Details

Keywords: Martha Lagace

April 2010
Teaching Note

Groupe Ariel S.A.: Parity Conditions and Cross-Border Valuation (Brief Case)

By: Timothy A. Luehrman and James Quinn

Teaching Note for 4194 View Details

Keywords: Exchange Rates; Securities Analysis; Project Evaluation; Debt Securities; Analysis; Currency Exchange Rate; Performance Evaluation; Projects; Capital Budgeting

Citation

Purchase

05 Mar 2019
First Look

New Research and Ideas, March 5, 2019

firms lever up, the overall cost of capital falls as leverage increases equity beta, but as debt becomes riskier the marginal benefit of increasing equity beta declines. As a simple theoretical framework predicts, we find that leverage is... View Details

Keywords: Dina Gerdeman

13 Oct 2015
First Look

October 13, 2015

private information with borrowers. When lenders grant debt forgiveness to borrowers, borrowers communicate that information to other borrowers, who are then more likely to strategically default on their own obligations. This strategic... View Details

25 Jan 2011
First Look

First Look: Jan. 25

disproportionately affect the debt financing costs faced by low credit quality firms. As a result, time-series variation in the average quality of debt issuers may be useful for forecasting excess corporate... View Details

Keywords: Sean Silverthorne

1985
Chapter

Stockholder, Manager, and Creditor Interests: Applications of Agency Theory

By: Michael Jensen and Clifford W. Smith Jr.

Keywords: Agency Theory; Business and Shareholder Relations; Financing and Loans; Credit; Borrowing and Debt

Citation

SSRN

September 2010
Article

Bank Lending During the Financial Crisis of 2008

By: Victoria Ivashina and David S. Scharfstein

This paper documents that new loans to large borrowers fell by 47% during the peak period of the financial crisis (fourth quarter of 2008) relative to the prior quarter and by 79% relative to the peak of the credit boom (second quarter of 2007). New lending for real... View Details

Keywords: Financial Liquidity; Financing and Loans; Credit; Borrowing and Debt; Financial Crisis; Banking Industry