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The Changing Nature of Investment Banking Relationships

Shane A. Corwin

University of Notre Dame - Mendoza College of Business

Mike Stegemoller

Baylor University

April 2014

We examine relationships between firms and their investment banks (IBs), both within and across different IB functions. For all transaction types, we find an increase in the number of relationships and a decrease in relationship exclusivity over time. We identify significant transaction-type specific relationship components, with relationships being strongest for equity and weakest for M&A. Relationships are less exclusive for firms with more bargaining power and more exclusive for younger, smaller firms, and firms with more growth options. Most importantly, we find strong evidence of a firm-wide relationship component that spans the functional areas of I-banking and increases over time.

Number of Pages in PDF File: 64

Keywords: Investment Banking, Underwriting, M&A Advising, Underwriter Relationships

JEL Classification: G10, G24, G34, L14

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Date posted: November 15, 2013 ; Last revised: May 3, 2014

Suggested Citation

Corwin, Shane A. and Stegemoller, Mike, The Changing Nature of Investment Banking Relationships (April 2014). Available at SSRN: https://ssrn.com/abstract=2354565 or http://dx.doi.org/10.2139/ssrn.2354565

Contact Information

Shane A. Corwin (Contact Author)
University of Notre Dame - Mendoza College of Business ( email )
240 Mendoza College of Business
Notre Dame, IN 46556-0399
United States
Michael A. Stegemoller
Baylor University ( email )
P.O. Box 98004
Waco, TX 76798-8004
United States
254-710-4145 (Phone)
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References:  19