Competing for Securities Underwriting Mandates: Banking Relationships and Analyst Recommendations

Relationship Capital and Competition in the Corporate Securities Underwriting Market

This paper examines how relationship capital drives competition among underwriting banks in the corporate bond underwriting market. The recent deregulation and subsequent re-entry by commercial banks into this market in the U.S. raises policy interest in measuring competitive e ect of the deregulation. The theories of relationship and reputation imply that (1) the entrants' products are di eren...

Big Data Cases in Banking and Securities

Sell Recommendations, Market Sentiment, and Analyst Credibility

We find that market reactions to an analyst’s earnings forecasts are weaker when conditioned on the number of prior sell recommendations that the analyst makes for other firms that he follows. This effect is most prominent in periods of high market sentiment (e.g., the 1997-2001 period) and is stronger for glamour firms. This effect does not arise from sell recommendations being a proxy for low...

Analyst Recommendations and Mergers: Do Analysts Matter?‡

This paper investigates the relation between investment analyst recommendations and merger completion. Unlike the new issues market, we argue analysts’ incentives are skewed to issue recommendations that ensure merger completion rather than maximize the overall deal value. Using a comprehensive sample of completed and withdrawn mergers, we observe the direction and affiliation of recommendation...

A Comparative View of Underwriting , Deregulating , and Overturning in Banking

During the 1980s, Congress passed a number of laws deregulating the US banking system and home loan process. Within a decade, this caused the demise of many savings and loans and has had major effects on banking into the twenty-first century. Several pieces of legislation have contributed to deregulation of the industry including Graham Leach Bliley and the Deregulation Monetary Control Act. In...