scholarly journals The Value of Investment Banking Relationships: Evidence from the Collapse of Lehman Brothers

2011 ◽  
Author(s):  
Chitru S. Fernando ◽  
Anthony D. May ◽  
William L. Megginson
Keyword(s):  
Investment Banking ◽  
Lehman Brothers ◽  
Banking Relationships

scholarly journals The Value of Investment Banking Relationships: Evidence from the Collapse of Lehman Brothers

2012 ◽  
Vol 67 (1) ◽  
pp. 235-270 ◽  
Author(s):  
CHITRU S. FERNANDO ◽  
ANTHONY D. MAY ◽  
WILLIAM L. MEGGINSON
Keyword(s):  
Investment Banking ◽  
Lehman Brothers ◽  
Banking Relationships

scholarly journals The Role of Investment Banking in M&A Operations: Empiric Pre and Post Lehman Evidence

2014 ◽  
Vol 1 (2) ◽  
pp. 51
Author(s):  
Vincenzo Capizzi ◽  
Renato Giovannini
Keyword(s):  
Investment Banking ◽  
Total Sample ◽  
Time Frame ◽  
Investment Banks ◽  
Measuring System ◽  
Lehman Brothers ◽  
Time Frames ◽  
The Impact ◽  
The Relationship

The role of investment banks in M&A operations is analyzed on the basis of empiric evidence. In particular, to point out the variations in the impact of the certification effect which can be ascribed to investment banks, the relationship between the value created for the shareholders in companies involved in special underwriting operations and the reputation of the banks appointed to act as advisors is examined. The analysis, which uses an original measuring system in order to assess and classify the reputation variable, focuses on transactions that have taken place between listed companies in two time frames, symmetrical to each other, specifically pre and post the Lehman Brothers bankruptcy. The total sample is composed of 229 transactions, divided into 161 and 68 observations, respectively pre and post Lehman. The result is that in the post Lehman period, unlike the preceding time frame, for which no significant empiric evidence is found, the wealth of the shareholders (of both targets and acquirers) is significantly influenced by the reputation of the investment banks which have acted as advisors. This indicates that, subsequent to the shock of the Lehman Brothers collapse, the certifying effect of the investment banks takes on an important role in the shareholders' choice.

The Effect of the Credit Crunch on Output Price Dynamics: The Corporate Inventory and Liquidity Management Channel*

2020 ◽  
Vol 136 (1) ◽  
pp. 563-619 ◽  
Author(s):  
Ryan Kim
Keyword(s):  
Cash Holdings ◽  
Empirical Support ◽  
Credit Crunch ◽  
Price Dynamics ◽  
Data Set ◽  
Output Price ◽  
Supply Shock ◽  
Level Data ◽  
Lehman Brothers ◽  
Banking Relationships

Abstract I study how a credit crunch affects output price dynamics. I build a unique micro-level data set that combines scanner-level prices and quantities with producer information, including the producer’s banking relationships, inventory, and cash holdings. I exploit the Lehman Brothers failure as a quasi-experiment and find that the firms facing a negative credit supply shock decrease their output prices approximately 15% more than their unaffected counterparts. I hypothesize that such firms reduce prices to liquidate inventory and generate additional cash flow from the product market. I find strong empirical support for this hypothesis: (i) the firms that face a negative bank shock temporarily decrease their prices and inventory and increase their market share and cash holdings relative to their counterparts, and (ii) this effect is stronger for the firms and sectors with a high initial inventory or small initial cash holdings.

scholarly journals Analyst Impartiality and Investment Banking Relationships

2005 ◽  
Author(s):  
Patricia C. O'Brien ◽  
Maureen F. McNichols ◽  
Hsiou-wei Lin
Keyword(s):  
Investment Banking ◽  
Banking Relationships

scholarly journals How Do Analyst Recommendations Respond to Major News?

2006 ◽  
Vol 41 (1) ◽  
pp. 25-49 ◽  
Author(s):  
Jennifer Conrad ◽  
Bradford Cornell ◽  
Wayne R. Landsman ◽  
Brian R. Rountree
Keyword(s):  
Stock Price ◽  
Public Information ◽  
Investment Banking ◽  
Optimistic Bias ◽  
Analyst Recommendations ◽  
Herding Behavior ◽  
Stock Recommendations ◽  
Price Increases ◽  
Banking Relationships ◽  
Stock Price Movements

AbstractWe examine how analysts respond to public information when setting stock recommendations. We model the determinants of analysts' recommendation changes following large stock price movements. We find evidence of an asymmetry following large positive and negative returns. Following large stock price increases, analysts are equally likely to upgrade or downgrade. Following large stock price declines, analysts are more likely to downgrade. This asymmetry exists after accounting for investment banking relationships and herding behavior. This result suggests recommendation changes are “sticky” in one direction, with analysts reluctant to downgrade. Moreover, this result implies that analysts' optimistic bias may vary through time.

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