#2209. Bankruptcy, overlapping directors, and bank loan pricing

August 2026publication date
Proposal available till 30-05-2025
4 total number of authors per manuscript4500 $

The title of the journal is available only for the authors who have already paid for
Journal’s subject area:
Finance;
Economics and Econometrics;
Business and International Management;
Places in the authors’ list:
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2 place - free (for sale)
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Abstract:
Using a sample of loan facilities borrowed by firms that share directors with bankrupt firms, this study investigates whether the overlapping directors are a transmission channel of the bankruptcy contagion effect in the bank loan market and, if so, what the underlying mechanism is. We find that firms are charged higher loan spreads in the period following the bankruptcy filing of a firm with a common director and that overlapping directors are a relevant channel for the bankruptcy contagion effect, in addition to other channels identified in literature.
Keywords:
Bankruptcy; Contagion effect; Loan spreads; Overlapping director

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