Publication Type

Journal Article

Version

publishedVersion

Publication Date

2-2024

Abstract

We confirm prior evidence that bonds on average are offered at prices below their immediate post-offer secondary market prices. However, in cases where banks lead–manage their own bond offerings the underpricing is significantly less as compared with other non-self-marketed offerings. These findings are robust across various matched samples and selection models. Our results suggest that the bond offering process is characterized by substantive agency conflicts between shareholders of corporations (issuers) and underwriters.

Keywords

Underwriters, bonds, market prices

Discipline

Finance and Financial Management | Portfolio and Security Analysis

Research Areas

Finance

Publication

Journal of Financial and Quantitative Analysis

Volume

59

Issue

1

First Page

369

Last Page

394

ISSN

0022-1090

Identifier

10.1017/S002210902200151X

Publisher

Cambridge University Press

Copyright Owner and License

Authors

Creative Commons License

Creative Commons Attribution 4.0 International License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Additional URL

https://doi.org/10.1017/S002210902200151X

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