Journal article
CEO Incentives, Relationship Lending, and the Cost of Corporate Borrowing
Abstract
We investigate how lending relationships attenuate the conflict of interest between creditors and shareholders that arises from chief executive officer (CEO) compensation contracts. We find that lending relationships mitigate the influence of CEO risk‐taking incentives on loan spreads, especially for informationally opaque firms. In addition, lending relationships attenuate the impact of CEO risk‐taking incentives on maturity and collateral …
Authors
Chen L; Qiu J
Journal
Financial Management, Vol. 46, No. 3, pp. 627–654
Publisher
Wiley
Publication Date
September 2017
DOI
10.1111/fima.12156
ISSN
0046-3892