WORLD CORPORATE LOAN MARKETS FOR RAISING NEW CAPITAL – DOES DISTANCE STILL MATTER: ARE FINANCIAL ASSETS PRICED LOCALLY OR GLOBALLY?

Borut Vojinovič

Economic Annals, 2006, vol. 51, issue 168, 31 - 48

Abstract: Though the paper focuses on pricing, as the background I provide some evidence about loan flows across markets in the form of borrowers’ and lenders’ propensity to issue outside their natural home market. The data show that borrowers stay home when they can and that they tend to issue in Europe when they must issue abroad. That is, borrowers domiciled in one of the major markets (Europe, U.S., and Asia) almost always issue in that market, whereas borrowers in more remote locations usually issue in the European market. For example, borrowers from Latin America are overwhelmingly issuing in Europe rather than in the U.S. market.

Keywords: loans; corporate debt; market integration; globalization (search for similar items in EconPapers)
JEL-codes: C10 E44 F36 G11 O11 P51 (search for similar items in EconPapers)
Date: 2006
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