Exploration of credit spreads and information disclosure quality of corporate bonds under economic policy uncertainty

Xiao Lu, Ze-Jia Zhou and Chenchen Feng

Finance Research Letters, 2025, vol. 82, issue C

Abstract: This paper focuses on public corporate bonds issued in the exchange market between 2016 and 2023, examining the link between information disclosure quality and bond credit spreads. Our findings reveal that higher disclosure quality notably narrows credit spreads. Moreover, increased economic policy uncertainty amplifies the negative impact of disclosure quality on spreads. Improved disclosure quality also mitigates financing constraints, further reducing credit spreads. Notably, private enterprises see a stronger influence of disclosure quality on their bond credit spreads compared to state-owned enterprises. As China's bond market expands, enhancing listed firms' disclosure quality is crucial for investors to access vital information and protect their interests. It also addresses the need to improve financing conditions for listed firms and bolster bond financing.

Keywords: Information disclosure quality; Bond credit spread; Economic policy uncertainty (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:82:y:2025:i:c:s1544612325007901

DOI: 10.1016/j.frl.2025.107531

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