The role of bank monitoring in borrowers[U+05F3] discretionary disclosure: Evidence from covenant violations

Journal Article (Journal Article)

This study uses covenant violations to provide evidence on how firms make disclosure decisions in the presence of enhanced bank monitoring. Using a regression discontinuity design, I find that firms reduce disclosure following covenant violations. A series of analyses suggest that part of this decline in disclosure reflects a delegation of monitoring to banks by shareholders who consequently demand less disclosure. © 2014 Elsevier B.V.

Full Text

Duke Authors

Cited Authors

  • Vashishtha, R

Published Date

  • January 1, 2014

Published In

Volume / Issue

  • 57 / 2-3

Start / End Page

  • 176 - 195

International Standard Serial Number (ISSN)

  • 0165-4101

Digital Object Identifier (DOI)

  • 10.1016/j.jacceco.2014.04.002

Citation Source

  • Scopus