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Working Paper
Banking relationships and sell-side research
This paper examines disclosures by sell-side analysts when their institution has a lending relationship with the firms being covered. Lending-affiliated analysts? earnings forecasts are found to be more accurate relative to forecasts by other analysts but this differential accuracy manifests itself only after the advent of the loan. Despite this increased earnings forecast accuracy, lending-affiliated analysts exhibit undue optimism in their brokerage recommendations and forecasts of long term growth. The optimism exists both before and after the lending commences. The evidence suggests that ...
Conference Paper
Expanding bank powers: a Canadian perspective
Working Paper
Bringing new issues to market: a theory of underwriting
Conference Paper
Problems of community banks and their need for expanded powers
Journal Article
Assessing the fairness of investment bankers' fees
Working Paper
Risk overhang and loan portfolio decisions
Despite operating under substantial regulatory constraints, we find that commercial banks manage their investments largely consistent with the predictions of portfolio choice models with capital market imperfections. Based on 1990-2002 data for small (assets less than $1 billion) U.S. commercial banks, net new lending to the business, real estate, and consumer sectors increased with expected sector profitability, tended to decrease with the illiquidity of existing (overhanging) loan stocks, and was responsive to correlations in cross-sector returns. Small banks are most appropriate for this ...
Conference Paper
What should regulators do in the age of money managers?