Economics, Econometrics and Finance
5 years ago

Loan officers significantly impact loan contract terms and performance outcomes.

1 view
Journal of Accounting and Economics
The influence of loan officers on loan contract design and performance
Robert M. Bushman, Janet Gao, Xiumin Martin, Joseph Pacelli

Paper Summary

Loan officers play a significant role in shaping the terms and performance of syndicated loans. They influence interest rates, loan conditions, and how well loans perform. Lead officers have more impact on loan terms and performance than participant officers. Loan officers have more influence on covenant design than interest rates, but less on loan maturity. Loan officers' effects are not just due to matching them with certain borrowers.

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