Liquidity risk and syndicate structure
By: Evan Gatev, Philip Strahan.
Contributors: Strahan, Philip E. 1963-; National Bureau of Economic Research.
Series: NBER working paper series -- working paper 13802; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 13802.
Publisher: National Bureau of Economic Research
Published: 2008
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Description: "We offer a new explanation of loan syndicate structure based on banks' comparative advantage in managing systematic liquidity risk.  When a syndicated loan to a rated borrower has systematic liquidity risk, the fraction of passive participant lenders that are banks is about 8% higher than for loans without liquidity risk.  In contrast, liquidity risk does not explain the share of banks as lead lenders.  Using a new measure of ex-ante liquidity risk exposure, we find further evidence that syndicate participants specialize in liquidity-risk management while lead banks manage lending relationships.  Links from transactions deposits to liquidity exposure are about 50% larger at participant banks than at lead arrangers"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 6/13/2008.

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