Hybrid bond issuances by insurance firms

Doojin Ryu and Jinyoung Yu

Emerging Markets Review, 2020, vol. 45, issue C

Abstract: This study reexamines the determinants of insurance firms' hybrid bond issuances. We also analyze the effects of these issuances on their issuers' financial solvency and performance. Logistic regression reveals that the likelihood of issuing a hybrid bond increases when the risk-based capital ratio is lower and when net income is greater. Additionally, difference-in-differences estimations with fixed effects show that hybrid bond issuances enhance insurance firms' insolvency risk and liquidity ratio but do not significantly improve overall financial solvency indices. The insolvency risk is mitigated when the bonds are issued to foreign creditors.

Keywords: Emerging market; Endogeneity; Fixed effects; Hybrid bond issuance; Insolvency risk (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ememar:v:45:y:2020:i:c:s156601412030203x

DOI: 10.1016/j.ememar.2020.100722

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