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Corporate Debt Maturity in Developing Countries: Sources of Long- and Short-Termism

Juan J. Cortina (), Tatiana Didier () and Sergio Schmukler ()
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Juan J. Cortina: World Bank

No 142, Mo.Fi.R. Working Papers from Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences

Abstract: This paper documents to what extent firms from developing countries borrow short versus long term, using data on corporate bond and syndicated loan markets. Contrary to claims in the literature based on firm balance sheets, firms from developing countries borrow through bonds and syndicated loans at maturities similar to those obtained by developed country firms. The composition and use of financing matters. Firms from developing countries borrow shorter term in domestic bond markets, but the differences in international issuances (accounting for most of the proceeds) are significantly smaller. Developing country firms borrow longer term in syndicated loan markets, which they partially use for infrastructure projects. However, only large firms from developing countries (similar in size to those from developed ones) issue bonds and syndicated loans. The short-termism in developing countries is partly explained by a lower proportion of firms using these markets, with more firms relying on other shorter-term instruments.

Keywords: capital raising; corporate bonds; domestic and international debt markets; developing countries; firm financing; issuance maturity; long-term debt; short-term debt; syndicated loans (search for similar items in EconPapers)
JEL-codes: F34 F65 G0 G10 G15 G21 G32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cfn and nep-ifn
Date: 2017-10
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http://docs.dises.univpm.it/web/quaderni/pdfmofir/Mofir142.pdf First version, 2017 (application/pdf)

Related works:
Journal Article: Corporate debt maturity in developing countries: Sources of long and short‐termism (2018) Downloads
Working Paper: Corporate debt maturity in developing countries: sources of long- and short-termism (2017) Downloads
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