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The Trends of Corporate Bond
Issuance and their possible
explanations
A study on the bond issues by public firms in Belgium,
France and Germany
Gisèle Deboutte
Warre Vermeulen
R0799548
R0810839
Promotor: Prof. dr. F. Hoffmann
Werkleider: A. Leeuwenkamp
Academiejaar: 2023-2024
0
Abstract
This master’s thesis investigates bond issues reported by Eikon for public firms
in Belgium, France, and Germany, with a particular focus on the propensity to
secure these issues over time and across countries. Summary statistics reveal
that the proportion of secured bond issues has declined in Germany over the
past three decades. In contrast, bond issues by public firms have increased
across all three markets. Additionally, German bond issues are more frequently
secured than those in Belgium and France. This difference can be partially
attributed to variations in the legal regimes of these countries, based on the
framework of creditor rights in the 'law and finance' literature.
2
Table of contents
1 Introduction 4
2 Literature review 6
2.1 How do firms finance themselves? 6
2.2 The role of collateral in corporate borrowing 7
2.3 The costs of pledging collateral 9
2.4 Changes in the nature of the firm: rise in intangibles assets 10
2.5 Higher resilience of bond market in recent recessions and overall rise in bond financing
10
2.5.1 Higher resilience of bond market in recent recessions 10
2.5.2 Overall rise in bond financing 11
2.6 Law and institutions and economic consequences 12
3 Data 15
4 Results 17
4.1 Bonds are not often secured in Belgium and France 17
4.1.2 Results in France 20
4.1.3 Overall results in Belgium and France 22
4.2 Larger propensity to secure in Germany 22
4.3 A rise in bond financing in all markets of interest 26
4.4 A decline in secured debt in Germany 28
4.5 Low percentage of secured Eurobonds 30
5 Theoretical arguments based on existing literature for the observed results 32
5.1 Different reasons for the small share of secured bonds in France and Belgium 32
5.1.1 Pledging collateral is too costly for firms 32
5.1.2 Lack of tangible capital 33
5.1.4 Bigger firms might use less collateral due to more financial flexibility 34
5.3 The rise in bond financing 35
5.4 The decline in secured debt in Germany 36
6 Further research 37
7 Conclusion 38
8 Sources and other materials 40
8.1 Sources 40
8.2 List of figures 49
8.3 List of tables 50
3
1 Introduction
Our legal thesis looks into the different effects of individual debt enforcement
across Belgium, France and Germany. We investigate whether or not being the
first to individually enforce debt through the seizure of a certain asset grants a
priority right on that good. Such priority right secures the claim that forms the
basis of the enforcement in the sense that the proceeds of the sale of the asset
are reserved for the satisfaction of that claim. In the legal systems lacking such
a priority right, the interest of the seizing creditor gets diluted by other creditors
who follow the initiative of the first enforcer, so that no competitive advantage is
obtained by acting first.
In Belgium, there are no priority rights granted by acting first. In Germany,
individual enforcement works in exactly the opposite manner, where a priority
right is obtained by enforcing first. In France, the outcome of individual
enforcement depends on the nature of the seized good(s).
However, a creditor can obtain the same outcome as the first enforcer in some
jurisdictions, through debt contracting: priority over a certain asset or pool of
assets and protection against dilution by other claims. These perks are
attributed to secured debt,1through which a creditor can ex ante obtain the
same effect as first enforcers in some legal systems.
In what follows, the extent of secured bond issues in Belgium, France, and
Germany is examined. Differences between the markets and over time are
explored, partly by considering legal discrepancies between the countries,
drawing on the law and finance literature. In addition to analyzing the propensity
to secure bond issues, the overall trend in bond financing by public firms is also
investigated.
1See e.g. Badoer, Dudley and James (2020); Donaldson, Gromb and Piacentino (2020);
Kronman and Jackson (1979).
4
Our paper contributes to the extensive literature on collateral in debt financing
as well as to recent papers commenting on the rise of bond financing in
bank-based Europe.
This analysis extends the recent paper by Benmelech, Kumar, and Rajan
(2024), which examines the decline of secured loan obligations in the US, to
include Belgium, France, and Germany. These three European countries are
chosen because the finance literature is primarily US-centered, and extending
the study to European markets may reveal interesting similarities or differences.
The paper wants to provide answers to the following research question “What
are the trends of the corporate bond issuance in the Belgian, French and
German bond market and what are their possible explanations?”
The rest of the paper is structured as follows: Chapter 2 reviews the existing
literature on collateral, bond issuance, and the impact of legal differences on
corporate debt. Chapter 3 outlines the data source, Refinitiv Eikon, and the
construction of the datasets. In Chapter 4, the results of the research are
presented. Chapter 5 explores potential theories behind these results, while
Chapter 6 suggests directions for further research. Finally, Chapter 7 provides
the conclusion.
5
2 Literature review
2.1 How do firms finance themselves?
Firms finance themselves through various means depending on different
reasons. Methods include using their retained profit, debt financing, equity
financing, bond financing, venture capital etc. These choices are driven by
economic and financial motives of which different theories have been
researched over the years.
A first choice that has to be made is the one between internal or external
financing. Internal financing is obtained through retained earnings, while
external financing can be obtained through a combination of debt and equity
(Goenawan and Wasistha, 2019).
The pecking order theory by Myers and Majluf (1984) suggests that a firm’s
tendency to use internal funding rather than external funding is linked to the
information asymmetry between shareholders and management. The
preference of financial instruments is ranked as follows: internally generated
funds, debt and equity (Myers and Majluf, 1984).
A seminal contribution to the capital structure theory is the Modigliani-Miller
(MM) theory (1958). The MM theory consists of two propositions. The first one
states that in a perfect capital market, the choice of capital structure has no
effect on the value of the firm. The value of a leveraged firm equals that of the
same firm financed solely through equity. The second proposition suggests that
the capital structure does matter in the presence of taxes. The firm value of a
debt-funded company will be larger, since the use of debt reduces corporate
income taxes as the interest expense is deducted from the income before taxes
(Modigiliani and Miller, 1958). According to this theory, debt financing can thus
enlarge the value of a firm through tax shields. Debt is however not entirely
value-creating; a tradeoff has to be made.
6
The Trade-off Theory, which builds on the MM theory, states that the capital
decision involves a trade-off between the tax benefit of debts and the costs of
financial distress (Kraus and Litzenberger, 1973).
When using external financing, a second choice follows, since firms can rely on
bank-based or market-based funding. There exists a debate about which capital
market is the most beneficial: a bank-based vs a market-based capital market.
The answer is not that clear cut and we see that results differ over time.
Literature before the Great Financial Crisis of 2008 does not favor one particular
financing structure over the other. These studies often find that the degree of
financial development and liberalization is what matters for the real economy
(Beck and Levine, 2002; Bekaert, Harvey and Lundblad, 2005; Levine, 2002)
and that bank and market financing are equally important (Boyd and Smith,
1998; Levine and Zervos, 1998). After the Great Financial Crisis, the arguments
for market-based financing gained strength, since a financial crisis seems to be
more severe in a bank-based financial system (Gambacorta, Yang and
Tsatsaronis, 2014).
In reality, Europe tends to be more bank-based, while the United States are
more market-based (Darmouni and Papoutsi, 2023; Langfield and Pagano,
2016).
2.2 The role of collateral in corporate borrowing2
There has been a lot of research that ponders on the relation between risk and
collateral.
On the one hand, low risk borrowers offer more collateral to solve adverse
selection problems by signaling quality, resulting in mitigating credit rationing
(Bester, 1985; Chan and Kanatas, 1985; Jiménez, Salas and Saurina, 2006;
Strahan, 1999). On the supply side, collateral can be demanded by suppliers of
finance to mitigate higher riskiness (Berger and Udell, 1990; Boot, Thakor and
2See Steijvers and Voordeckers (2009).
7
Udell, 1991; Brick and Palia, 2007; Pozzolo, 2002). The relation between credit
risk and the use of collateral is therefore not clear cut. Berger, Frame and
Ioannidou (2016) argue that the different risk characteristics observed in both
model-based and empirical research can be attributable to differences in
‘economic characteristics’ of the assets underlying the secured debt, particularly
asset liquidity.
Collateral plays a role in overcoming moral hazard problems. Secured debt has
been argued as a measure against asset-substitution, because the encumbered
asset is harder to exchange for a riskier one, thus lowering risk and monitoring
costs for the lender, as opposed to covenants limiting asset substitutability
(Boot, Thakor and Udell, 1991; Jackson and Kronman, 1979; Smith and Warner,
1979).
Another reported effect of secured debt is that it can incentivize lenders to
monitor debt more, particularly when the collateral value is volatile (Cerquiero,
Ongena and Roszbach, 2016; Rajan and Winton, 1995).
Collateral in itself also lowers risk for the lender, regardless of the risk of the
borrower. It facilitates enforcement against the debtor, since a specific asset is
assigned to a specific (group of) creditor(s), and in addition to that collateral
protects against claim dilution by other creditors (Badoer, Dudley and James,
2022; Cerquiero, Ongena and Roszbach, 2016; Donaldson, Gromb and
Piacentino, 2022; Kronman and Jackson, 1979).
The role of collateral in corporate finance is also dependent on other borrower
characteristics than risk. Listed firms are required to post less collateral as
compared to unlisted firms (Fang, Qian and Zou, 2020). This relation has also
been established concerning firm size. Bigger firms are less likely to have to
post collateral (Lehmann and Neuberger, 2000; Lian and Ma, 20203; Pozzolo,
2002). Firm size is a major factor in explaining financial constraints (Whited and
Wu, 2006; Hadlock and Pierce, 2010). Small firms have to pledge relatively
3The authors differentiate between asset-based lending and cash-flow lending, which can be
interpreted as secured vs unsecured lending, as is done by (Rampini and Viswanathan, 2020).
8
more assets as compared to big firms, because bigger firms shift to secured
debt as they become more financially constrained (Rampini and Viswanathan,
2020).
2.3 The costs of pledging collateral
While a lot of research has been done on the benefits of collateral, the cost of
pledging collateral has received less attention. The conventional wisdom used
to be that the cost of pledging collateral is relatively low in relation to the large
benefits of protecting lenders and allowing borrowers to receive cheaper credit
and better conditions (Pan, Pan and Xiao, 2023). Nevertheless, the pledging of
collateral could impose significant hidden costs (Pan, Pan and Xiao, 2023).
First and foremost, firms lose operational flexibility, as collateral agreements
normally restrict the assets encompassed in the agreement from being sold,
relocated, repurposed, refurbished or transformed (Mello and Ruckes, 2017).
Firms will need to obtain the lender’s consent to deal with the encumbered
assets (Mello and Ruckes, 2017). Mann (1997) conducted a series of interviews
with practitioners, where a CFO expressed his aversion to secured debt. He
stated that secured debt is “a question of flexibility and having to deal with it.”
He explained that “in a secured loan, you just don’t have the same flexibility of
dealing with your properties as if you owned them unencumbered.” (Mann,
1997, p. 665).
Furthermore, firms also lose financial flexibility by pledging collateral. Obtaining
unsecured finance (Donaldson, Gromb and Piacentino, 2020) or accessing
liquidity through an asset sale (Donaldson, Gromb and Piacentino, 2022) is
harder when a firm has a high asset encumbrance. A firm might even lose its
flexibility in financial distress as secured creditors may not be interested in
restructuring the debt (Benmelech, Kumar and Rajan, 2024; Vig, 2013).
In addition, collateral and the right of secured lenders to liquidate outside
collective insolvency procedures can entail a liquidation bias as opposed to
9
supporting reorganization, which leads to an ex post inefficiency. Furthermore,
since unsecured creditors are diluted by a secured creditor, their financing costs
rise (Vig, 2013).
2.4 Changes in the nature of the firm: rise in intangibles assets
Both in the US and European market, there exists a relative rise in intangible
capital in firms (Corrado, Haskel, Jona-Lasinio and Iommi, 2016; Crouzet and
Eberly, 2018; Falato, Kadyrzhanova, Sim and Steri, 2022; Lim, Macias and
Moeller, 2022).
Research shows that firms with more tangible assets often have more secured
debt. Tangible assets constitute suitable collateral that lenders can redeploy at
relatively low transaction costs when borrowers default or become distressed
(Frank and Goyal, 2009). Tangible assets tend to be less risky and easier to
value than intangible assets, which makes them easier to collateralize (Lim,
Macias and Moeller, 2022; Rampini and Viswanathan, 2022).
2.5 Higher resilience of bond market in recent recessions and overall rise
in bond financing
2.5.1 Higher resilience of bond market in recent recessions
There exists extensive literature on the behavior of bond markets in times of
crisis. Authors suggest that the resilience of the bond market to recession is
higher than that of banks (Becker and Benmelech, 2021) resulting in a shift to
market financing by firms requiring funds (Kashyap, Stein and Wilcox, 1993).
In recent recessions, public debt markets have been both less volatile and less
cyclical than the bank financing market (Becker and Ivashina, 2014).
In the Great Financial Crisis, there was an observed shift from bank financing to
bond financing by firms, both in the US (Adrian, Colla and Song Shin, 2013;
10
Barraza, Lee and Yeager, 2015) as in the European market (De Fiore and Uhlig,
2014).
A more moderate bond market expansion was observed due to the COVID-19
crisis both in the US (Halling, Yu, Zechner, 2020) and in the European market
(Holm-Hadulla, Musso, Nicoletti and Tujula, 2022). Darmouni and Siani (2020)
provide evidence that bond issuance crowds out bank loans in the case of a
liquidity shock, even when the crisis did not originate in the financial sector,
such as the COVID-19 crisis.
In the case of a contraction of bank credit, firms requiring funds who are unable
to address banks, need to issue bonds instead (Becker and Ivashina, 2015).
The cyclical effect of secured issues is not unanimously reported in literature.
Some authors report that secured debt is acyclical (Azariadis, Kaas and Wen,
2016; Luk and Zheng, 2022), whilst others argue that the issue of secured debt
is countercyclical (Benmelech, Kumar and Rajan, 2022), which is in accordance
with authors reporting that priority spreading of debt is more likely in bad
economic weather (Badoer, Dudley and James, 2020).
2.5.2 Overall rise in bond financing
In the European market, there has been a growing issuance of bonds as
compared to bank-financing, notably in the aftermath of the Great Financial
Crisis (Berg, Saunders, Steffen, 2020; Cappiello, Holm-Hadulla, Maddaloni,
Mayordomo, Unger e.a., 2021: Holm-Hadulla, Musso, Nicoletti and Tujula,
2022). This is partially due to a reduction of accessible bank credit in the recent
crisis periods, leading to a shift to bond financing as elaborated above, in
addition to ECB interventions since the sovereign debt crisis of 2011-2012
(Berg, Saunders, Steffen, 2020). Notably, the ‘large-scale asset purchases’ by
the ECB led to a shift to bond financing by firms eligible for the ECB purchases
of corporate bonds (Grosse-Rueschkamp, Steffen and Streitz, 2019).
11
The rise in corporate bond financing in the European market is in part a
long-term implication of bank credit contraction and a shift to market financing
during the Great Financial Crisis and the sovereign debt crisis (Cappiello,
Holm-Hadulla, Maddaloni, Mayordomo, Unger et al., 2021; Holm-Hadulla,
Musso, Nicoletti and Tujula, 2022). As a result, the volume of bonds as
compared to bank-financing in the European market has risen to around 30%,
compared to 15% prior to the Great Financial Crisis (Cappiello, Holm-Hadulla,
Maddaloni, Mayordomo, Unger et al., 2021; Holm-Hadulla, Musso, Nicoletti and
Tujula, 2022).
2.6 Law and institutions and economic consequences
Since securing debt is done according to the law applicable to the debt contract,
the law and institutions enforcing the law have an impact on the behavior of
both borrowers and lenders. The ‘law and finance’ literature, stemming from the
seminal works of La Porta, Lopez-De-Silanes, Schleifer and Vishny (LLSV),
looks into the effects of legal rules and the quality of the enforcement of those
rules on capital markets (La Porta, Lopez-De-Silanes, Schleifer, Vishny, 1997
and 1998). They essentially showed that there exists a link between the legal
system and economic development (LLSV 1998).
LLSV constructed a so-called creditor rights index, to examine the laws
governing investor protection. The creditor rights index is scored on a scale of
4. The score is dependent on 4 questions pertaining to the rights of secured
creditors in insolvency procedures; one point is attributed for each positive
answer.4
LLSV attribute 3 points to Germany, 2 to Belgium and 0 to France. This means
that Germany is regarded to have the strongest creditor rights. Djankov, Mcliesh
and Shleifer (2007) updated the index up until 2002 and the score of our 3
4See Appendix 1.
12
countries of interest remained the same.5In addition, the authors show that, in
general, the creditor rights remain stable over time.
There exists a huge offspring from the initial works of LLSV, reporting a plethora
of correlations between law and institutions and economic measures.6For
example there exists a positive correlation between a higher score on the
creditor rights index and the size of credit markets (LLSV 1997; Djankov,
Mcliesh and Shleifer, 2007), lower spreads on loans (Bae and Goyal, 2009) and
higher lending volume (Haselmann, Pistor and Vig, 2009).
Qian and Strahan (2007) posit that, as creditor rights improve, debt contracts
are expected to be more secured on average. This relation is even stronger with
firms that have a higher degree of tangible assets, which are more prone to be
secured as compared to intangible assets.7Vig (2013) uses a simple model to
show that, a reform strengthening creditor rights, according to the law and
finance literature, expands the scope of feasible contracts. This leads to debtors
now being able to borrow, due to the more beneficial insolvency code, that were
not able to do so beforehand.
Such a reform would lead to the usage of secured debt to either remain the
same or to increase. Vig (2013) however finds that in India the usage of
secured debt had declined after a reform strengthening creditor rights. The
author stresses that this could be attributed to the costs that are introduced due
to the reform, stating that strengthening creditor rights to obtain the positive
effects, can introduce unwanted costs leading to a negative overall outcome.
Stronger creditor rights can improve access to debt financing in two ways. They
can reduce the cost of credit for firms that were previously not able to obtain
credit. In addition to that, debt could be extended to firms that were seen as too
risky to engage with before the reform (Armour, Menezes, Uttamchandani and
Van Zwieten, 2015). Assunção, Benmelech and Silva (2014) show that a law
dropping court approval of cars as collateral, led to a “democratization of credit”
7See 2.4 Changes in the nature of the firm.
6See (La Porta, Lopez-De-Silanes and Shleifer, 2008).
5See Appendix 1.
13
which led to lower-income borrowers to obtain loans. This is consistent with the
fact that more financially constrained parties need to post collateral more often
(Lehmann and Neuberger, 2000; Pozzolo, 2002; Lian and Ma, 2020).
14
3 Data
For our research the Refinitiv Eikon database was used, which contains
comprehensive historical and actual financial data and economic information for
over 175 countries in 60 markets. Two datasets were constructed. Our first
sample consists of all active and inactive bond issues of public firms in Belgium,
France and Germany available on Eikon.
The bond issues in our 3 countries of interest were sorted using the variable
‘country of issue’. The issues linked to a country encompass both issues by
firms incorporated in that country, along with a very limited number of issues
done by foreign firms in the market under scrutiny. ‘Country of issue' was
chosen over 'country of incorporation' to focus on the bond issues of a market,
rather than those of firms incorporated in a particular country. Nonetheless, the
vast majority of for example firms issuing in Belgium are Belgian so the
difference is minimal.
A filter to only include public firms was applied, as public firms have more
reliable data and their incentives are more likely to be market-based as
compared to private firms. This also kept the data manageable.
In Belgium, 341 observations were obtained, the first one issued on June 15th
1979. In France, 3874 observations were obtained, starting from November 4th
1971. Germany has 12.141 observations of which the first is from April 1st
1930. The cut-off date for all countries was April 4th 2024.
Our second dataset consists of both active and inactive Eurobonds issued by
public firms incorporated in Belgium, France and Germany. ‘Eurobonds’ are
undefined in the Refinitiv Eikon database. Since the term ‘Eurobond’ emerges in
the variable ‘country of issue’, they are bonds that are issued in multiple
markets by firms extending the issue beyond their domestic market. In Belgium
342 observations were obtained, 37.032 in France and 34.557 in Germany.
15
Since the variable ‘country of issue’ is equal to ‘Eurobond’ for these issues, the
data was sorted by the variable ‘country of incorporation’.
The same variables in both datasets were included. For the variable ‘Seniority’
Refinitiv Eikon classifies bond issuance in different categories; (1) Junior
unsecured or junior subordinated, (2) Senior non-preferred, (3) Senior
preferred, (4) Senior secured, (5) Senior secured - Mortgage, (6) Senior
secured - First lien, (7) Senior secured - Second lien, (8) Subordinated
unsecured, (9) Senior unsecured, (10) Subordinated secured, (11) Secured and
(12) Unsecured. This paper defines secured bonds as bonds of the categories
(4), (5), (6), (7) (10) and (11), in line with Benmelech, Kumar and Rajan (2024).
For some observations in both datasets and across all countries, the 'amount
issued' is missing. These observations were included in the calculation of
summary statistics and time-series based on numeric bond issuance, but
omitted from value-based summary statistics and time-series calculations.
Furthermore, three potentially incorrect observations were found in the
'domestic issues' data. In France, in 1999, Carrefour SA is listed as issuing two
bonds with supposed values of 552,994,976,266 EUR and 587,180,630,989
EUR. In Germany, in 1986, Henkel AG & Co KGaA is shown as issuing a bond
worth 742,150,551,544 EUR. These three observations were omitted when
calculating summary statistics and time-series based on value.
16
4 Results
The data analysis process involves a two-fold approach to examining the
datasets. Findings are discussed on a country-by-country basis. The analysis
begins with an examination of summary statistics, which offer initial insights into
the dataset. Subsequently, the focus shifts to exploring time series data to
identify trends and patterns over time.
4.1 Bonds are not often secured in Belgium and France
4.1.1 Results in Belgium
Secured bond issuance
(EUR)
Unsecured bond
issuance (EUR)
Total bond issuance
(EUR)
Mean
1.465.982.719,52
218.325.328,85
259.638486,52
Median
1.242.260.519,75
68.412.719,24
74.434.527,85
Table I - Summary statistics: Belgian Domestic Bonds, 1979 to 2023.
In Belgium, the percentage of secured bonds is low, but the proportion of
secured value is significantly higher. This is also clear when comparing the
mean and median of secured bond issuance to the mean and median of
unsecured bond issuance and total bond issuance. The mean of the secured
bond value is around 570% higher than the mean unsecured bond value. This
explains how the secured bonds represent only 2,92% of the number of issues
but 18,70% of the issued value. We can deduce that the larger bonds are more
17
Numeric
Value (EUR)
Secured bond issues
10
Secured value
1.465.982.7195,18
Total bond issues
342
Total value
78.410.822.928
Share of secured issues
2,92 %
Share of secured value
18,70%
likely to be secured. This observation is grounded in literature. Leeth and Scott
(1989) argue that when obtaining a loan of a smaller amount, the likelihood of
pledging collateral decreases. Cowling (1999) found that loan duration and loan
size exert positive effects on the probability of loan collateralization.
The propensity to secure in Belgium is low, since only a very small percentage
of issues (2,92%) from one firm, BNP Paribas Fortis SA, led to a significant
secured degree in value (18,70%).
Figure 1 a. Total and secured bond issuance in Belgium, 1987 to 2023 (number of issues).
18
Figure 1 b. Total and secured bond issuance in Belgium, 1987 to 2023 (value of issues).
The dataset on Belgian domestic bonds begins in 1979, however the second
bond issuance follows 8 years later. Therefore the time-series graph begins in
1987.
Figure 1 a. shows an initial spike in 1991, a pattern that does not appear in the
value-based graph in Figure 1 b. This peak is not necessarily a market trend, as
it results from the behavior of one player. As many as 19 out of the 26 bonds
that year, or 73,08%, were issued by BNP Paribas Fortis SA. BNP Paribas
Fortis is the biggest bond issuer in the Belgian market; they issued 104 bonds
accounting for 30,40% of the total bond issuance on that market. KBC Groep
NV, another bank, is the second biggest issuer with 49 bonds.
Later in the timeline, bond issuance begins to increase around 2012–2013. A
second significant spike in bond issuance is evident during the COVID-19 crisis
in 2020–2021 (Figure 1 a.), with a 21.15% rise compared to the previous two
years. This observation aligns with findings by Holm-Hadulla, Musso, Nicoletti,
and Tujula (2022), who noted an increase in bond issuance at the onset of the
COVID-19 crisis. In the years 2019-2020 the share of secured bonds peak as
well and rises to as much as 53,82% and 67,92%, respectively. This
19
observation points in the direction of the relation reported by Benmelech, Kumar
and Rajan (2021), namely that secured debt is countercyclical, but goes against
the acyclical relation of secured debt reported by Azariadis, Kaas and Wen
(2016) and Luk and Zheng (2022).
4.1.2 Results in France
Secured bond
issuance (EUR)
Unsecured bond
issuance (EUR)
Total bond issuance
(EUR)
Mean
271.552.305,20
575.518.933,14
575.274.914,25
Median
396.288.812,14
75.928.340,82
75.928.340,82
Table II - Summary statistics: French Domestic Bonds, 1971 to 2023.
In France, the share of secured bonds is lower, both in number and in value. A
comparison of the mean and median of secured bonds between France and
Belgium shows that those in France are 81.45% and 68.11% smaller,
respectively. The mean of total bond issuance on the other hand is significantly
larger, about 121,43%, while the median is roughly the same.
The mean of secured bond issuance in France is smaller than the median
because of the fact there are only three secured bonds issued in the French
market, and one of them is considerably smaller than the other two:
398.445.812,14 EUR, 396.288.812,14 EUR and 19.922.290,38 EUR.
20
Numeric
Value (EUR)
Secured bond issues
3
Secured value
814.656.915,59
Total bond issues
3874
Total value
2.149.802.354.536,19
Share of secured issues
0,08%
Share of secured value
0,04%
Figure 2 a. Total and secured bond issuance in France, 1971 to 2023 (number of issues).
Figure 2 b. Total and secured bond issuance in France, 1971 to 2023 (value of issues).
Both Figure 2 a. and Figure 2 b. indicate that bond financing has been on the
rise since 2008, slightly earlier than in Belgium. In terms of total value issued,
there is a slight decline in 2021, showing a 36.64% decrease compared to the
previous year.
21
4.1.3 Overall results in Belgium and France
The share of secured bond issues is relatively small, both in Belgium and in
France. In both countries, there has been an increase in bond financing over
the last decade or two, which will be discussed in section 4.3.
4.2 Larger propensity to secure in Germany
Secured bond
issuance (EUR)
Unsecured bond
issuance (EUR)
Total bond issuance
(EUR)
Mean
128.900.600,63
257.361.522,40
229.151.278,17
Median
25.826.438,79
15.495.739,97
20.473.158,68
Table III - Summary statistics: German domestic bonds, 1930 to 2023.
In Germany, a relatively high degree of bond issues are secured, both in terms
of value as the number of bonds. Because of the amount of secured
observations, potential trends will be discussed in 4.4.
22
Numeric
Value (EUR)
Secured bond issues
2626
Secured value
338.492.977.367,42
Total bond issues
12141
Total value
2.740.190.984.390,12
Share of secured issues
21,63%
Share of secured value
12,36%
Figure 3a - Total and secured bond issuance in Germany, 1949 to 2023 (number of issues).
Figure 3b - Total and secured bond issuance in Germany, 1949 to 2023 (value of issues).
The first bond observation stems from 1930, however, the second bond
issuance is observed 19 years later, therefore the graph starts in the year 1949.
In Figure 3a, the numeric bond issuance shows a steep rise in 1997, 1998, and
1999, with issuance in these years 136.42% higher than in the three preceding
years. In Figure 3b, the rise in value is less pronounced but still clearly evident.
23
Figure 3b shows two significant spikes in the value of bond issuance: one in
2009 and another in 2012. A smaller, but still notable, spike is observed in 2015.
These three spikes will be examined in closer detail.
In 2009 a value of 331.235.416.738 EUR was issued in 480 bonds. Three big
players issued 98,13% of these 480 bonds: 262 were issued by Commerzbank
AG, 110 by Deutsche Pfandbrief AG and 99 by Deutsche Bank AG. However,
when looking at the value, Deutsche Pfandbrief accounted for 90,33% or
299.316.334.243 EUR issued that year. Given the substantial size of this figure,
it is necessary to examine Deutsche Pfandbrief’s balance sheet. Such bond
issues appear highly improbable. In 2023, their total assets were valued at
50.883.000 EUR,8making it unlikely that they issued bonds totaling nearly 300
billion EUR.
In 2012, a total value of 260.880.544.189 EUR was issued, of which
245.916.001.634 EUR attributed to Deutsche Bank AG. The bank issued 80
bonds in total, of which 24 amounted to 9.961.145.348 EUR. Again this data
raises skepticism. According to the balance sheet of 2023 their total assets are
valued at 1.317.266.000 EUR.9
In 2015, a similar issue seems to arise. According to the data, a total value of
139.650.308.043 EUR was issued, with Deutsche Bank AG accounting for 122
bonds totaling to 129.019.071.460 EUR.
Therefore the data for Deutsche Pfandbrief AG for the year 2009 and Deutsche
Bank AG for the year 2012 and 2015 was omitted and a new graph was
constructed (Figure 3c.).
9Yahoo!Finance, Deutsche Bank Aktiengesellschaft (DBK.DE), Balance sheet,
https://finance.yahoo.com/quote/DBK.DE/balance-sheet
8Yahoo!Finance, Deutsche Pfandbriefbank AG (PBB.DE), Balance sheet,
https://finance.yahoo.com/quote/PBB.DE/balance-sheet
24
Figure 3c - Total and secured bond issuance in Germany - adapted, 1949 to 2023 (value of issues).
Figure 3c illustrates an increase in the total issued value during 1998-1999,
accompanied by a corresponding rise in the secured amount. In subsequent
years, from 2006 to 2023, the total issued value exhibits significant fluctuations.
However, the secured amount remains relatively stable, with only minor
increases and decreases that generally follow the trends in the total issued
value.
In 2009, 2012, and 2015, what were previously very high peaks are now
observed as relatively low points. This discrepancy may be explained by the
omission of bond data from Deutsche Pfandbrief AG in 2009 and Deutsche
Bank AG in 2012 and 2015. Excluding these issuers likely removed a significant
portion of the data that was, in fact, accurate, which could account for the
unusually low observations in these years.
Looking at the rest of the data, it becomes clear that the bonds issued by these
three players make up approximately 85% of all bonds issued each year,
despite the large number of bond issuers in the German market. In total, there
are 243 bond issuers, though the majority are quite small. Around 90% of these
issuers have issued between 1 and 5 bonds over the entire period from 1949 to
2023.
25
4.3 A rise in bond financing in all markets of interest
Both Figure 1b and Figure 2b display a clear upward trend in the total value of
bonds issued in the Belgian and French markets, respectively. In contrast,
Figure 3c shows considerable fluctuation in the total issued value in the German
market, making it more difficult to discern a consistent trend. To assess whether
bond financing has experienced a genuine increase across all three markets,
three new graphs were constructed based on the issued bond values, each
including a trendline for more accurate analysis.
Figure 4a - Total value of bond issuance in Belgium with a linear trendline, 1987 to 2023.
y = - 2097,5 + 205,9 t
R2= 0,5783
26
Figure 4b - Total value of bond issuance in France with a linear trendline, 1971 to 2023.
y = - 147427 + 1323,4 t
R2= 0,5857
Figure 4c - Total value of bond issuance in Germany with a linear trendline, 1949 to 2023.
y = - 14740 + 843,33 t
R2= 0,5241
A clear upward trend is observed across all three countries of interest, across
time, which signifies a growing activity in the bond markets of Belgium, France
and Germany. This rise can be partly explained by economic growth and
27
inflation, but nonetheless the graphs indicate a clear rising trend. In addition,
growth and inflation were also present in the earlier periods, and the trend
remained flat for a long period of time.
4.4 A decline in secured debt in Germany
Given Germany's significant share of observed secured bonds, the fractions of
secured bonds will be plotted over time to identify potential patterns or trends in
secured bond issuance. This analysis begins with the entire dataset, excluding
the very first observation in 1930, as shown in Figure 5.
Figure 5. Secured bonds as a fraction of total bond issuance in Germany, 1949 to 2023.
The share of secured bonds in total bond issuance in Germany is the ratio of
the number of secured bonds to the total issuance.
From 1949 until 1953, all issued bonds were secured. In the following period,
from 1954 to 1970, there seems to be no coherent trend in bond securing since
the ratio varies from 0% to 100%. Afterwards the bond securing dropped
tremendously. From 1971 until 1990 almost no or a very small fraction of bonds
were secured. The share bounced back in 1991 and the years after.
28
A linear trend model is estimated of the share of secured bonds on a time index
variable for the whole dataset of domestic bonds issued in Germany (defining t
as years since 1949). The fitted linear trend model is given by:
𝑠𝑒𝑐𝑢𝑟𝑒𝑑 𝑏𝑜𝑛𝑑𝑠
𝑡𝑜𝑡𝑎𝑙 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑏𝑜𝑛𝑑𝑠 = 12, 39 − 0, 0061 * 𝑡
The linear trend model shows that the share in bonds has declined over the 74
years that are captured in this dataset. The coefficient estimate indicates that
the ratio of secured bonds to total bonds issuance declined on average at an
annual rate of 0.61 percentage points from 1949 until 2023. The R² of the
regression is 0,2141.
This declining trend is not necessarily clear when looking at the overall picture
of the scatterplot. However, when focusing on the last three decades, a more
consistent decline in the share of secured bonds is observed. Figure 6. zooms
in on the years 1991 to 2023. Another fitted linear trend model is estimated for
these years.
Figure 6. Secured bonds as a fraction of total bond issuance in Germany, 1990 to 2023.
The fitted linear trend model is given by (defining tas years since 1990):
𝑠𝑒𝑐𝑢𝑟𝑒𝑑 𝑏𝑜𝑛𝑑𝑠
𝑡𝑜𝑡𝑎𝑙 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑏𝑜𝑛𝑑𝑠 = 12, 424 − 0, 0061 * 𝑡
29
The linear trend model shows once more a decline in the secured bond
issuance. The coefficient estimate indicates that the ratio of secured bonds to
total bonds issuance declined on average at an annual rate of 0.61 percentage
points from 1990 until 2023, which is actually the same as in the fitted linear
trend model estimated for the entire dataset. The R² of the regression is 0,2099.
The average share of secured bonds in this period is 23,27%.
4.5 Low percentage of secured Eurobonds
The fact that secured domestic issues are relatively low in all three countries,
can be due to the fact that the assets are already encumbered by other
outstanding debt. Therefore, the analysis is extended to active and inactive
Eurobond issues, issued by Belgian, French and German firms. If a substantial
share of Eurobonds is secured, then this could point to the fact that firms
reserve their assets to be secured for Eurobond issues.
Secured bond issuance (EUR)
Total bond issuance (EUR)
Belgium
Mean
248.452.103,49
308.604.786,22
Median
248.452.103,49
79.777.849,54
France
Mean
395.908.708,56
51.172.628,75
Median
103.038.314,05
2.307.325,00
Germany
Mean
192.423.808,04
32.405.692,80
Median
44.825.154,04
4.614.650,00
30
Numeric
Value (EUR)
Belgium
Secured bond issues
1
Secured value
248.452.103,49
Total bond issues
341
Total value
105.234.232.101,47
Table IV - Summary statistics Eurobonds: Belgium (1985 to 2023), France (1971 to 2023) and
Germany (1984 to 2023).
Eurobonds seem to be less frequently secured than domestic bonds. This
means that the possibility that the assets were already encumbered for
Eurobond issues does not hold, because there is an even slighter percentage of
secured issues for Eurobonds, across all three countries of interest. It appears
that securing Eurobond issues is a very niche activity and that securing
Eurobonds is rarely a part of the strategy of the fixed income instrument.
31
Share of secured
issues
0,29%
Share of secured
value
0,24%
France
Secured bond issues
21
Secured value
8.314.082.879,86
Total bond issues
37.032
Total value
1.886.785.994.781,42
Share of secured
issues
0,06%
Share of secured
value
0,44%
Germany
Secured bond issues
177
Secured value
34.059.014.022,82
Total bond issues
34.557
Total value
1.117.542.722.010,08
Share of secured
issues
0,51%
Share of secured
value
3,05%
5 Theoretical arguments based on existing literature for the
observed results
This chapter explains the five obtained results by extending existing literature to
the bond markets of Belgium, France and Germany.
5.1 Different reasons for the small share of secured bonds in France and
Belgium
A very small percentage of bond issuance is secured in Belgium and France, as
opposed to Germany. There is not one conclusive argument for this occurrence.
In this section elaborates on different plausible arguments found in the
literature.
5.1.1 Pledging collateral is too costly for firms
As discussed in the literature review (see 2.3), pledging collateral or securing
bonds could imply significant costs way beyond the traditional transactional
expenses, like fees for lien filing and, occasionally, costs for asset appraisal
(Pan, Pan and Xiao, 2023). The upfront securing of bond issuance can be
costly, both in transaction costs and opportunity costs (Pan, Pan and Xiao,
2023).
Firms might not want to pledge collateral as they want to maintain their
operational flexibility. By pledging assets as collateral, the firm will need to hold
on to the asset or ask the bondholders for permission to do as they please
(Mello and Ruckes, 2017).
Next to operational flexibility, firms want to maintain financial flexibility.
Unpledged collateral can have high value in the future (Rampini and
Viswanathan, 2010).
32
5.1.2 Lack of tangible capital
A complementary explanation might be that firms do not have the traditional
tangible collateral to pledge. A reason for this is the change in the nature of the
firm (see 2.4). There has been a rise of intangible capital in firms in the EU
(Corrado, Haskel, Jona-Lasinio and Iommi, 2016; Crouzet and Eberly, 2018;
Falato, Kadyrzhanova, Sim and Steri, 2022; Lim, Macias and Moeller, 2022).
These intangible assets such as patents, trademarks and brand names, are
normally thought of as hard to use as collateral. Together with this rise in
intangible assets, the share of the value of tangible assets as a fraction of firm
value has been in decline (Benmelech, Kumar and Rajan, 2024).
These tangible assets such as property, plants and equipment are traditionally
used to collateralize loans. Firms with few hard collateralizable assets and more
substantial intangible sources might find pledging collateral more onerous or
burdensome because of their higher liquidation costs (Benmelech, Kumar and
Rajan, 2024).
The low share in secured bonds could therefore be related to the declining
share in asset tangibility (Benmelech, Kumar and Rajan, 2024).
5.1.3 Trust in bankruptcy procedures and accounting regulations
Collateral can play a role in overcoming moral hazard problems, or can mitigate
borrower risk through a higher recovery rate in insolvency (see 2.2). The same
could be argued for efficient bankruptcy procedures and sufficient accounting
standards (Benmelech, Kumar and Rajan, 2024).
Benmelech, Kumar and Rajan (2024) suggest that improved trust in accounting
and bankruptcy procedures, gave lenders more confidence in the reliability of
reported cash flows, which led to a smaller need to secure debt. Therefore it
can be argued that one of the reasons for the low share of secured bonds is the
increased trust in accounting and bankruptcy procedures in the countries of
Belgium and France, possibly due to European harmonization legislation. An
33
example on accounting standards is the 2002 regulation no. 1606/2002,
compelling every listed company to report using the IFRS standards.
5.1.4 Bigger firms might use less collateral due to more financial flexibility
A supplementary explanation for the low observed proportion of secured debt
could be found in the use of our data screener. Since we inquire exclusively into
public firms, our sample consists of relatively large firms. Large (and public)
firms are less financially constrained as opposed to small firms, which leads to
the fact that they have to post assets less often (Fang, Qian and Zou, 2020;
Lehmann and Neuberger, 2000; Lian and Ma, 202010; Pozzolo, 2002) (see 2.2).
Besides that, public firms are also audited and their books are public
information. They have to disclose more information, which could explain a
smaller incentive to secure for lenders.
5.2 Law and Finance: differences in legal regimes across our countries of
study
Based on the law and finance literature, authors have tried to attribute certain
cross-country differences to differences in laws that are applicable in the
respective countries. One measure through which this is done is the creditor
rights index, as developed by LLSV (1997, 1998) and updated by Djankov,
Mcliesh and Shleifer (2007).
The fact that bonds issued in Germany are far more frequently secured as
opposed to Belgium and France can be explained by the law and finance
literature. As Qian and Strahan (2007) and Vig (2013) have proposed, stronger
creditor rights would lead to secured debt being used more frequently.
Consequently, Germany (3) scores higher on the creditor rights index as
opposed to Belgium (2) and France (0), both in the original index of LLSV
(1997) as in the updated version by Djankov, Mcliesh and Schleifer (2007).
10 The authors differentiate between asset-based lending and cash-flow lending, which can be
interpreted as secured vs unsecured lending, as is done by (Rampini and Viswanathan, 2020).
34
This could constitute a possible reason as to why bond issues in Germany are
far more frequently secured. In addition, Belgium has a higher score than
France, and our observation shows that issues in Belgium are more frequently
secured than those in France.
The stronger creditor rights in Germany and Belgium, as opposed to France,
could lead to the fact that the contractual field in Germany and Belgium is
larger. Meaning that in the margin, more risky or more constrained borrowers
can obtain finance, consistent with Armour, Menezes, Uttamchandani and Van
Zwieten, (2015). These marginal lending activities could have a higher chance
of being secured (Berger and Udell, 1990; Boot, Thakor and Udell, 1991;
Pozzolo, 2002; Brick and Palia, 2007). For example, due to the fact that the
issuing firms already have a high debt burden, and need to post collateral to
obtain additional credit. In addition, secured debt becomes a more efficient
measure for secured creditors, which could lead to an incentive to use it in debt
contracting, because it could outweigh the costs that collateral entails.
This argument is not at all conclusive, as the law and finance literature battles
with heterogeneity problems that are not absent here (Armour, Menezes,
Uttamchandani and Van Zwieten, 2015).
5.3 The rise in bond financing
The rise in bond financing could be explained by their higher resilience in
recessions (see 2.5.1). After the Great Financial Crisis, a shift has been
observed from bank financing to bond financing in bank-based Europe (De
Fiore and Uhlig, 2014). A same, but more moderate shift, has been observed
after the COVID-19 Crisis (Holm-Hadulla, Musso, Nicoletti and Tujula, 2022).
The expansion of the bond market in our three markets of interest, can be
explained as a long-term implication of these crises (see 2.5.2).
35
5.4 The decline in secured debt in Germany
The same arguments explaining the low propensity to secure debt in Belgium
and France could explain the decline in secured debt in Germany. Securing
bonds might be too costly, especially because of hidden costs like the loss of
operational and financial flexibility (see 3.2 and 5.1.1). Also the rise of intangible
assets in firm capital might have the effect that firms do not have as many
collateralizable assets as before (see 5.1.2). Lastly, a decline in secured debt
can be attributed to a growing trust in bankruptcy procedures and accounting
standards in Germany, possibly due to European harmonization legislation,
such as the 2002 regulation no. 1606/2002 compelling every listed company to
report using the IFRS standards (see 5.1.3).
5.5 Even lower proportion of secured Eurobonds
A possible reason as to why the propensity to secure Eurobonds in the three
markets of interest is even lower than with domestic bonds could be linked to
the level of risk. Because Eurobonds have a higher liquidity due to a larger
market than a domestic issue. One could argue that Eurobonds hold a lower
risk. If there is less risk to mitigate, bondholders might deem it not necessary to
ask for collateral as suggested by various studies (Berger and Udell, 1990;
Boot, Thakor and Udell, 1991; Pozzolo, 2002; Brick and Palia, 2007). Another
possible argument could be that securing Eurobonds is simply not part of the
fixed instrument strategy. Since Eurobonds are issued in larger markets, it could
be that the risk of the Eurobonds is internalized instead of mitigated through
collateral. Enforcing collateral implies court action and this is especially
burdensome for non-domestic investors.
36
6 Further research
Market based financing tells only one (small) part of the story. There are other,
perhaps more obvious options to obtain debt financing for firms than the bond
market. It could be that the declining propensity to secure bonds in Germany, is
due to an inclining propensity to secure other debt sources, resulting in a status
quo or perhaps even incline (Benmelech, Kumar and Rajan, 2024). Therefore,
an obvious research path that would complement our paper is investigating
bank data. This extension is actually much needed, since Europe is relatively
bank-based (Darmouni and Papoutsi, 2023). Looking into the (un)secured
nature of outstanding corporate debt could shed light on whether the low
propensity to secure is also present in bank loans.
Another way of assessing whether or not the observed low propensity to secure
is an actual trend, and not just attributable to bond financing, is to look into
firm-level data. An extension can also be made to private firms, to investigate
whether the same trends exist for private firms, since they are regarded as
more financially constrained.11
On a more general note, with sufficient data one could perform regression
analysis, especially to test the significance of the creditor rights index on the
proportion of secured debt.
Another point of interest is the use of debt covenants, for example ‘negative
pledge covenants’ to create levels of seniority in the debt structure of firms.
They serve a purpose that is comparable to secured debt, but lack the legal
strength of formally secured debt (Badoer, Dudley and James, 2020). Exploring
these covenants and other contractual clauses could shed a light on the priority
structure of debt contracts.
11 see e. g. Whited and Wu, 2006; Hadlock and Pierce, 2010.
37
7 Conclusion
In this thesis, the trends in corporate bond issuance by public firms were
analyzed across three domestic markets: Belgium, France, and Germany. The
research was then extended to include the Eurobond market for Belgian,
French, and German firms.
The findings reveal that only a small percentage of bonds are secured in
Belgium and France. In contrast, Germany exhibits a higher propensity to
secure debt; however, a decline in secured bond issuance has been observed
over the past three decades. Possible explanations for both the low percentage
of secured bonds and the decline in Germany include similar factors. One
potential reason is the (hidden) cost of pledging collateral, such as the loss of
financial and operational flexibility. Additionally, the increasing prominence of
intangible assets, which are harder to collateralize, may explain the limited use
of secured debt. Another plausible explanation is the growing trust in
bankruptcy procedures and accounting regulations. Lastly, the dataset
construction itself may offer an explanation: by focusing on public firms, which
tend to be larger, the analysis includes companies that are often less financially
constrained than smaller firms, making them less likely to secure their debt.
The cross-country differences between Belgium, France and Germany could be
accounted for by differences in their legal regimes. Literature suggests that
stronger creditor rights, which is the case in Germany, would lead to debt being
secured more often.
In all three bond markets a rise in bond financing in the last decades is
observed, which is explained by a long-term consequence of the shift to bond
financing in the recent crisis periods.
Our final observation points at an even lower propensity to secure Eurobonds in
the three markets of interest than there is to secure domestic bonds. This could
be linked to their lower level of liquidity risk, or to the fact that enforcing
38
collateral in court is particularly burdensome for non-domestic investors which
leads to the internalization of the risk in the bond issue.
39
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48
8.2 List of figures
Figure 1 a. Total and secured bond issuance in Belgium, 1987 to 2023 (number of issues).
Figure 1 b. Total and secured bond issuance in Belgium, 1987 to 2023 (value of issues).
Figure 2 a. Total and secured bond issuance in France, 1971 to 2023 (number of issues).
Figure 2 b. Total and secured bond issuance in France, 1971 to 2023 (value of issues).
Figure 3 a. Total and secured bond issuance in Germany, 1949 to 2023 (number of issues).
Figure 3 b. Total and secured bond issuance in Germany, 1949 to 2023 (value of issues).
Figure 3 c. Total and secured bond issuance in Germany - adapted, 1949 to 2023 (value of issues).
Figure 4 a. Total value of bond issuance in Belgium with a linear trendline, 1987 to 2023.
Figure 4 b. Total value of bond issuance in France with a linear trendline, 1971 to 2023.
Figure 4 c. Total value of bond issuance in Germany with a linear trendline, 1949 to 2023.
Figure 5. Secured bonds as a fraction of total bond issuance in Germany, 1949 to 2023.
Figure 6. Secured bonds as a fraction of total bond issuance, 1990 to 2023.
49
8.3 List of tables
Table I - Summary statistics: Belgian Domestic Bonds, 1979 to 2023.
Table II - Summary statistics: French Domestic Bonds, 1971 to 2023.
Table III - Summary statistics: German Domestic Bonds, 1930 to 2023.
Table IV - Summary statistics Eurobonds: Belgium (1985 to 2023), France (1970 to 2023), Germany
(1984 to 2023).
50
8.4 Appendices
Appendix 1: LLSV creditor rights scores
A score of one is assigned when each of the following rights of secured lenders
are defined in laws and regulations. The 4 questions are as follows:
- Q1: Are there are requirements for a debtor to file for a reorganization
process, e.g. creditor consent?
- Q2: Is there no automatic stay and can secured creditors access the
collateral?
- Q3: Are secured creditors paid first out of the proceeds of liquidation?
- Q4: Does management not obtain the possession of the administration in
case of reorganization?
Q1
Q2
Q3
Q4
Total
creditor
rights
score
Belgium
0
0
1
1
2
France
0
0
0
0
0
Germany
0
1
1
1
3
Source: datasets linked on the Harvard website
● La Porta, R., Lopez-De-Silanes, F., Shleifer, A. & Vishny, R. (1998). Law
and Finance. Journal of Political Economy, 106(6), 1113-1154.
https://scholar.harvard.edu/shleifer/publications/law-and-finance
● Djankov, S., McLiesch, C. & Schleifer A. (2007). Private credit in 129
Countries, The Journal of Finance, 84(1), 299-329.
https://scholar.harvard.edu/shleifer/publications/private-credit-129-countri
es
51
52
