Cyberattacks and Impact on Bond Valuation
28 Pages Posted: 18 Apr 2019
Date Written: March 21, 2019
We examine the impact of cyberattacks on bondholder wealth. Unlike stockholders, bondholders do not react in the short-term but do experience negative returns in the one-month event window. Compared to similar firms not subject to cyberattacks, we find that bondholders lost approximately 2% of their wealth within a one-month period surrounding the attack (a loss of $3.8 million on average). In this decade of advanced cybersecurity, bondholders still suffer similar losses compared to the last decade. To our knowledge, this is the first study that analyzes the impact of cyberattacks on bondholder wealth.
Keywords: cyber risk, cyberattacks, bondholder wealth
JEL Classification: G10, G12, G13
Suggested Citation: Suggested Citation