The Impact of Bank Entry in the Japanese Corporate Bond Underwriting Market

The 1993 Japanese financial system reform allowed banks to enter the underwriting market for corporate bonds through bank-owned security subsidiaries. This paper examines empirically whether underwriting commissions and spreads for corporate bonds fell as a result of this bank entry. The empirical results show that bank entry significantly lowers underwriting commissions. Commissions charged by banks are significantly lower than those charged by investment houses. In contrast, there is no strong evidence that bond spreads are significantly lowered by bank entry. A main bank relationship between the issuing firm and the parent of a bank-owned underwriting subsidiary does not have any significant influence in commission setting or the determination of spreadsfinancial system reform, bank entry, bank share, commission, main bank, spread, underwriting

The impact of migration on the cross-border M&A: some evidence for Japan

Facing the rapidly ageing society and shrinking of markets at home, Japanese firms are expanding outbound mergers and acquisitions (M&A) activity at a record pace. This study examines the determinants of Japanese cross-border M&A activity focusing on the role of migrant networks in overcoming the informational barriers to such activity. Migrants include immigrants residing in Japan as well as Japanese citizens residing abroad. Our results suggest that the presence of immigrants and of Japanese citizens residing abroad both increase the probability of acquiring assets in a potential target country. Moreover, both communities exert positive effects on the number and value of outbound M&A deals

Is there a safety premium in the design of corporate bond contracts?

This study examines empirically whether there is a safety premium in the design of bond contracts by highlighting a safety attribute of general mortgage bonds in Japan, which can give especially strong protection to bondholders, who would have priority in the event of legal liquidation. The effects of a safety attribute were not prominent at first in difference-in-differences analysis. However, the methods for analyzing selectivity bias allow us to provide a safety premium in the design of bond contracts, such as lower spread, lower commission, and larger issue size. The resulting bias would depend on the reputation of the bookrunner. This study uncovers the underlying link for the connection between a safety attribute and the observed and unobserved issuer and bookrunner characteristics, to indicate that a safety premium is related to various terms of bond contracts, including the bookrunner-issuer match

Convenience yield on government bonds and unconventional monetary policy in Japanese corporate bond spreads

This paper examines the factors that contribute to credit spreads in the primary market for Japanese corporate bonds, especially when the Bank of Japan implemented unconventional monetary policy measures. The models of credit spreads based on the Treasury convenience yield hypothesis are estimated using an issue-level dataset. The results indicate that the factors to explain credit spreads changed under the unconventional monetary policy regime. Investors became less sensitive to the risk of default for issuers with different credit quality due to the unprecedented degree of monetary easing. The Japanese government’s debt-to-GDP ratio, which is a measure of the convenience yield on government bonds, is an important driver of credit spreads throughout the sample period

International human capital mobility and FDI: Evidence from G20 countries

Human talent will be (or is already) scarce. We view international students as the source of high-skilled labour force, which satisfies the skill and task requirement of firms, particularly those anticipating overseas expansion, and argue whether the international student stock in a country is an indication of positive future prospect for the acquiror country in cross-border mergers. Using the international students’ stocks between pairs of acquiror countries of origin and target firms’ countries for bilateral mergers and acquisitions (M&A) activities, we exploit the within variation of both bilateral M&A activities and bilateral international student stocks between G20 countries. The formation of human capital signals that potential acquirors can access skilled workers and boosts the bilateral M&A activities. Results further indicate that the marginal effect of international students from target country in acquiror country has larger impact than that from acquiror country in target country

Differential effects of unconventional monetary policy on syndicated loan contracts

We investigate the effects of monetary policy on the financing policies of firms through the expected market interest rate channel at the firm level with Japanese syndicated loan contracts from 2000 to 2016, when monetary policy in Japan was almost stuck at the zero bound and the Bank of Japan introduced various unconventional monetary policy measures. To identify the interest rate channels of this monetary policy, we control for both observed and unobserved firm heterogeneity and unobserved time-varying bank heterogeneity in loan contracts. The evidence presented here demonstrates that both pricing (loan spread) and non-pricing (loan maturity) terms of loan contracts are affected by monetary policy shocks. In particular, monetary policy shocks have heterogeneous effects on loan maturity. The response to a monetary policy shock associated with a decrease in long-term interest rates is significant only for the borrower group with access to bonds, that is, less financially constrained firms

The impact of migrants on the cross-border M&A: Some evidence for Japan

Japanese outbound M&A activity has been running at a record pace regardless of the exchange rate movements. This paper examines the determinants of Japanese outbound M&A activity and the link between the migrants, which refer to both immigrants and Japanese citizens residing abroad, and Japanese outbound cross-border M&A activity in order to investigate whether immigrants alleviate the informational problems and stimulate the cross-border M&A activity with their host countries. Our results suggest that both immigrant and Japanese citizens residing abroad increase the probability of acquiring the asset in a potential target country. Moreover, both stocks have also a positive effect on the number of outbound M&A deals and the value of outbound M&A deals

The impact of migrants on the cross-border M&A: Some evidence for Japan

Japanese outbound M&A activity has been running at a record pace regardless of the exchange rate movements. This paper examines the determinants of Japanese outbound M&A activity and the link between the migrants, which refer to both immigrants and Japanese citizens residing abroad, and Japanese outbound cross-border M&A activity in order to investigate whether immigrants alleviate the informational problems and stimulate the cross-border M&A activity with their host countries. Our results suggest that both immigrant and Japanese citizens residing abroad increase the probability of acquiring the asset in a potential target country. Moreover, both stocks have also a positive effect on the number of outbound M&A deals and the value of outbound M&A deals

International human capital mobility and FDI: Evidence from G20 countries

Human talent will be (or is already) scarce. We view international students as the source of high-skilled labour force, which satisfies the skill and task requirement of firms, particularly those anticipating overseas expansion, and argue whether the international student stock in a country is an indication of positive future prospect for the acquiror country in cross-border mergers. Using the international students’ stocks between pairs of acquiror countries of origin and target firms’ countries for bilateral mergers and acquisitions (M&A) activities, we exploit the within variation of both bilateral M&A activities and bilateral international student stocks between G20 countries. The formation of human capital signals that potential acquirors can access skilled workers and boosts the bilateral M&A activities. Results further indicate that the marginal effect of international students from target country in acquiror country has larger impact than that from acquiror country in target country

The whole blood transcriptional regulation landscape in 465 COVID-19 infected samples from Japan COVID-19 Task Force

「コロナ制圧タスクフォース」COVID-19患者由来の血液細胞における遺伝子発現の網羅的解析 --重症度に応じた遺伝子発現の変化には、ヒトゲノム配列の個人差が影響する--. 京都大学プレスリリース. 2022-08-23.Coronavirus disease 2019 (COVID-19) is a recently-emerged infectious disease that has caused millions of deaths, where comprehensive understanding of disease mechanisms is still unestablished. In particular, studies of gene expression dynamics and regulation landscape in COVID-19 infected individuals are limited. Here, we report on a thorough analysis of whole blood RNA-seq data from 465 genotyped samples from the Japan COVID-19 Task Force, including 359 severe and 106 non-severe COVID-19 cases. We discover 1169 putative causal expression quantitative trait loci (eQTLs) including 34 possible colocalizations with biobank fine-mapping results of hematopoietic traits in a Japanese population, 1549 putative causal splice QTLs (sQTLs; e.g. two independent sQTLs at TOR1AIP1), as well as biologically interpretable trans-eQTL examples (e.g., REST and STING1), all fine-mapped at single variant resolution. We perform differential gene expression analysis to elucidate 198 genes with increased expression in severe COVID-19 cases and enriched for innate immune-related functions. Finally, we evaluate the limited but non-zero effect of COVID-19 phenotype on eQTL discovery, and highlight the presence of COVID-19 severity-interaction eQTLs (ieQTLs; e.g., CLEC4C and MYBL2). Our study provides a comprehensive catalog of whole blood regulatory variants in Japanese, as well as a reference for transcriptional landscapes in response to COVID-19 infection