Collateral and Adverse Selection in Transition Countries

This paper tackles the question of knowing whether collateral helps solve adverse selection problems in transition countries. We use a unique dataset of about 400 bank loans from 16 transition countries. Our findings support the view of a positive link between the presence of collateral and the risk premium, which is in accordance with the observed-risk hypothesis. This suggests that collateral does not mitigate adverse selection problems in transition countries.Bank, collateral, transition economies.

Syndicated Loans in Emerging Markets

There has been a considerable expansion of the volume of syndicated loans in emerging markets in the recent years. We provide the first analysis of the determinants of the decision of banks to syndicate a loan on a sample of loan facilities from 50 emerging countries. We show the significant role of loan characteristics and of financial development, banking regulation, and legal institutions, on the decision to syndicate a loan. We support the efforts of authorities to increase banking competition and efficiency, and to implement binding banking regulation on capital requirement to promote the expansion of syndicated loans.Bank, Loan, Syndication, Emerging Markets, Logit Regressions.

Foreign bank lending and information asymmetries in China

This paper considers whether information asymmetries affect the willingness of foreign banks to participate in syndicated loans to corporate borrowers in China. In line with theoretical literature, ownership concentration of the borrowing firm is assumed to influence information asymmetries in the relationship between the borrower and the lender. We analyze how ownership concentration influences the participation of foreign banks in a loan syndicate using a sample of syndicated loans granted to Chinese borrowers in the period 2004-2009 for which we have information on ownership concentration. We observe that greater ownership concentration of the borrowing firm does not positively influence participation of foreign banks in the loan syndicate. Additional estimations using alternative specifications provide similar results. As foreign banks do not react positively to ownership concentration, we conclude that information asymmetries are not exacerbated for foreign banks relative to local banks in China. Moreover, it appears that increased financial leverage discourages foreign bank participation, suggesting that domestic banks are less cautious in their risk management.bank; foreign investors; information asymmetry; loan; syndication; China

Asymmetric Information and Loan Spreads in Russia: Evidence from Syndicated Loans

This paper considers whether local bank participation exerts an impact on the spreads for syndicated loans in Russia. Following Berger, Klapper and Udell (2001), we test whether local banks possess a superior ability to deal with information asymmetries. Using a sample of 528 syndicated loans to Russian borrowers, we perform regressions of the spread on a set of variables including information on local bank participation and the characteristics of loans and borrowers. Unlike earlier studies, we distinguish foreign banks with a local presence from those without such presence. The intuition here is that a local presence may influence a foreign bank’s monitoring ability and access to information about borrowers. We observe no significant impact on the spread when there is local bank participation in a syndicated loan, nor do we find any significant influence of the presence of domestic-owned banks or foreign-owned banks on the spread. Additional estimations considering subsamples with exacerbated information asymmetries provide similar results. Therefore our conclusion is that local banks do not benefit from an advantage in monitoring ability and in information in Russia.bank; information asymmetry; loan; syndication; Russia

Stock market reaction to debt financing arrangements in Russia

This paper investigates stock market reaction to debt arrangements in Russia. The analysis of the valuation of debt arrangements by stock markets provides information about the use of debt by Russian companies. We apply the event study methodology to check whether debt announcements lead to abnormal returns using a sample of Russian listed companies that issued syndicated loans or bonds between June 2004 and December 2008. We find a negative reaction of stock markets to debt arrangements that can be explained by moral hazard behavior of shareholders at the expense of debtholders. Further, we observe no significant difference between announcements of syndicated loans and bonds. Thus, our findings support the view that Russian companies could have incentives to limit their reliance on external debt.corporate bonds; event study; Russia; stock returns; syndicated loans

AN EMPIRICAL INVESTIGATION OF THE RELATIONSHIP BETWEEN FIRM PERFORMANCE AND SYSTEM SUCCESS

This study investigates the relationship between system success as operationalized by user information satisfaction (UIS) and various economic measures of firm performance. The findings indicate a significant positive but complex relationship between firm performance and UIS. In particular, we found that it is inappropriate to aggregate UIS scores across individuals within a firm. The CEO, Controller, and Production Manager within a firm tended to have quite different UIS scores, resulting in low interrater reliabilities. We also found, that the association between a respondent's UIS score and the measures of firm performance depended heavily on the position of the respondent and the particular performance measure employed.Information Systems Working Papers Serie

ON THE STATE-OF-THE-ART: METHODS FOR EVALUATING THE PERFORMANCE EFFECTS OF INVESTMENTS IN INFORMATION TECHNOLOGY

IT creates impacts at several levels in the firm and often indirectly contributes to firm profitability. The problem IS researchers face is identifying robust methods that give reliable results. This paper reports on state-of-the-art methods in IT value research, reviews eleven major empirical studies and suggests three fundamental classes of considerations for conducting successful IT value research. To illustrate methodological advance, new results are presented from two recently completed IT value studies in financial services and manufacturing. The paper concludes by suggesting untapped theory bases that have the most to offer IT value research.Information Systems Working Papers Serie

AN EVALUATIVE FRAMEWORK FOR RESEARCH ON THE PERFORMANCE EFFECTS OF INFORMATION TECHNOLOGY INVESTMENT

Firms today invest enormous resources in information technology with the hope of gaining significant returns which will impact their performance. A growing body of research into the firm performance effects of IT investment has emerged and is sometimes referred to as IT business value reseakh. The problem researchers face is identifying robust methods to gain insight into how IT business value is created. This paper reports on the state of IT business value research by reviewing thirteen empirical studies. It also proposes a new evaluative framework to identify strengths and weaknesses in this research. The paper concludes with a series of recommendations to improve the quality of future IT business value research

Lie series for celestial mechanics, accelerators, satellite stabilization and optimization

Lie series applications to celestial mechanics, accelerators, satellite orbits, and optimizatio