De facto seniority in the primary market for corporate bonds

Ju Hyun Kim

Finance Research Letters, 2024, vol. 62, issue PA

Abstract: This paper documents the existence of de facto seniority in the primary market for corporate bonds. Analysis of Korean data from 2018 to 2021 shows that investors require larger yield spreads for debt with later maturities in an issuance cohort. This relation is robust to controlling for macroeconomic conditions, important issue characteristics, the stated use of proceeds, and alternate fixed effects.

Keywords: De facto seniority; Corporate bonds; Issuance spread; Bond maturity; Primary market (search for similar items in EconPapers)
JEL-codes: G12 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:62:y:2024:i:pa:s1544612324001466

DOI: 10.1016/j.frl.2024.105116

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