Issue Frequency and Corporate Bond Yields

36 Pages Posted: 7 Jul 2006

See all articles by Abe de Jong

Abe de Jong

Monash University; University of Groningen; European Corporate Governance Institute (ECGI)

Willem Schramade

Nyenrode Business University

Peter Roosenboom

Rotterdam School of Management, Erasmus University; Erasmus Research Institute of Management (ERIM)

Date Written: June 22, 2006

Abstract

This paper finds that frequent bond issuers get significantly better pricing than infrequent issuers, with yield spread discounts of up to 117 basispoints. We document firms' bond issue frequencies for windows from one week to six years before the current issue and relate them to yield spreads. For very large firms, issue frequency in windows up to one year matters most, which is consistent with benefits through increasing market literacy. Reputation acquisition seems more relevant for regular firms, as it is beneficial for them to be a recent issuer. The results suggest there is a firm-specific optimal issue frequency.

Keywords: yields, bonds, security issuing

JEL Classification: G20, G24, G30

Suggested Citation

de Jong, Abe and Schramade, Willem and Roosenboom, Peter, Issue Frequency and Corporate Bond Yields (June 22, 2006). Available at SSRN: https://ssrn.com/abstract=912505 or http://dx.doi.org/10.2139/ssrn.912505

Abe De Jong

Monash University ( email )

900 Dandenong Rd
Room H3-56
Caulfield East, Victoria 3145
Australia

HOME PAGE: http://https://research.monash.edu/en/persons/abe-de-jong

University of Groningen ( email )

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9700 AB Groningen
Netherlands

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
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1000 Brussels
Belgium

Willem Schramade (Contact Author)

Nyenrode Business University ( email )

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Breukelen, 3620 AC
Netherlands

Peter Roosenboom

Rotterdam School of Management, Erasmus University ( email )

P.O. Box 1738
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3000 DR Rotterdam
Netherlands
+31 10 40 82255 (Phone)

Erasmus Research Institute of Management (ERIM) ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

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