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Bank underwriting of debt securities: Modern evidence

Publication ,  Journal Article
Gande, A; Puri, M; Saunders, A; Walter, I
Published in: Review of Financial Studies
January 1, 1997

This article examines debt securities underwritten by Section 2O subsidiaries of bank holding companies relative to those underwritten by investment bouses. Consistent with a net certification effect for banks, bank underwriting of lower credit rated firms to whom the bank lends results in relatively higher prices (lower yields). We find no evidence of conflicts of interest even when an issue is used to repay bank debt. Further, banks bring a relatively larger proportion of small issues to the market. Contrary to the contention that universal banking stunts availability of finance to small firms, bank underwritings appear to benefit small firms.

Duke Scholars

Published In

Review of Financial Studies

DOI

ISSN

0893-9454

Publication Date

January 1, 1997

Volume

10

Issue

4

Start / End Page

1175 / 1202

Related Subject Headings

  • Finance
  • 3801 Applied economics
  • 3502 Banking, finance and investment
  • 1502 Banking, Finance and Investment
  • 1402 Applied Economics
  • 1401 Economic Theory
 

Citation

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Gande, A., Puri, M., Saunders, A., & Walter, I. (1997). Bank underwriting of debt securities: Modern evidence. Review of Financial Studies, 10(4), 1175–1202. https://doi.org/10.1093/rfs/10.4.1175
Gande, A., M. Puri, A. Saunders, and I. Walter. “Bank underwriting of debt securities: Modern evidence.” Review of Financial Studies 10, no. 4 (January 1, 1997): 1175–1202. https://doi.org/10.1093/rfs/10.4.1175.
Gande A, Puri M, Saunders A, Walter I. Bank underwriting of debt securities: Modern evidence. Review of Financial Studies. 1997 Jan 1;10(4):1175–202.
Gande, A., et al. “Bank underwriting of debt securities: Modern evidence.” Review of Financial Studies, vol. 10, no. 4, Jan. 1997, pp. 1175–202. Scopus, doi:10.1093/rfs/10.4.1175.
Gande A, Puri M, Saunders A, Walter I. Bank underwriting of debt securities: Modern evidence. Review of Financial Studies. 1997 Jan 1;10(4):1175–1202.
Journal cover image

Published In

Review of Financial Studies

DOI

ISSN

0893-9454

Publication Date

January 1, 1997

Volume

10

Issue

4

Start / End Page

1175 / 1202

Related Subject Headings

  • Finance
  • 3801 Applied economics
  • 3502 Banking, finance and investment
  • 1502 Banking, Finance and Investment
  • 1402 Applied Economics
  • 1401 Economic Theory