Corporate Response to Distress: Evidence from the Asian Financial Crisis
FRB St. Louis Review, 2011, 93 (2), pp.127-154
Posted: 17 Jul 2006 Last revised: 30 Jul 2013
Date Written: 2011
This paper provides a comprehensive examination of the ways in which companies respond to financial distress by restructuring their assets (through asset sales, mergers or liquidations) or liabilities during an economy-wide crisis. We contrast financial and corporate governance considerations and find strong support for the notion that, during a crisis, both financial constraints and corporate governance have a large impact on the restructuring choice.
Keywords: bankruptcy, liquidation, restructuring, corporate governance
JEL Classification: G33, G34
Suggested Citation: Suggested Citation