Non-Pricing Drivers of Underwriters’ Market Shares in Corporate Bond Markets

34 Pages Posted: 1 Feb 2018 Last revised: 26 Sep 2018

See all articles by Santiago Carbo-Valverde

Santiago Carbo-Valverde

Bangor Business School; Universidad Complutense de Madrid (UCM) - Colegio Universitario de Estudios Financieros (CUNEF)

Pedro Cuadros-Solas

Colegio Universitario de Estudios Financieros (CUNEF)

Francisco Rodriguez-Fernandez

University of Granada - Department of Economic Theory and History

Date Written: August 23, 2018

Abstract

In this paper, we explore the effects of pricing and non-pricing competitive factors on banks’ market shares as underwriters. Using a panel of underwriters in the European corporate bond markets from 2006-2013, we find that pricing factors are of second-order importance in explaining changes in underwriters’ market shares. Our results show that underwriting market shares exhibit a degree of persistency over time since prior market shares explain current market shares. Furthermore, providing joint lending and underwriting services, hiring star analysts for the underwriting team and being the leader bank placing bonds in a particular industry affects positively underwriters’ market shares.

Keywords: underwriters, market shares, bond, lending

JEL Classification: G24, G21, H81

Suggested Citation

Carbo-Valverde, Santiago and Cuadros-Solas, Pedro and Rodriguez-Fernandez, Francisco, Non-Pricing Drivers of Underwriters’ Market Shares in Corporate Bond Markets (August 23, 2018). Available at SSRN: https://ssrn.com/abstract=3108604 or http://dx.doi.org/10.2139/ssrn.3108604

Santiago Carbo-Valverde

Bangor Business School ( email )

Bangor Business School
College Road
Gwynedd LL57 2DG, Wales LL57 2DG
United Kingdom

Universidad Complutense de Madrid (UCM) - Colegio Universitario de Estudios Financieros (CUNEF) ( email )

Serrano Anguita 9
Madrid, Madrid 28004
Spain

Pedro Cuadros-Solas (Contact Author)

Colegio Universitario de Estudios Financieros (CUNEF)

C/ Leonardo Prieto Castro, 2, Ciudad Universitaria
Madrid, Madrid 28040
Spain

Francisco Rodriguez-Fernandez

University of Granada - Department of Economic Theory and History ( email )

Granada
Spain

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