RIEBセミナー
TJAR Research Workshop
（TJAR Workshop主催、RIEBセミナー共催）
RIEBセミナー
RIEBセミナー
| 日時 | 2023年06月23日(金) 10:40 - 12:10 |
|---|---|
| 会場 | 神戸大学経済経営研究所 会議室（研究所新館2階） |
| 対象 | 教員，院生，および同等の知識をお持ちの方 |
| 使用言語 | 英語 |
| 参加登録 | ※事前登録制です。下記より参加登録をお願い致します。追って、詳細をご連絡いたします。 参加登録 締切：6/19 |
10:40 - 12:10
- 論題
- Loan Covenant Violation and Corporate Pension Funding
- 報告者
- Harminder SINGH（Department of Finance, Deakin Business School, Deakin University）
- 概要
- We find that the level of defined benefit pension deficits increases following violations of loan contracts’ covenants. The increase in pension deficits is more pronounced for firms with underfunded pension plans, lower credit ratings, weaker lending relationships, or weaker bargaining power with the lenders. Following covenant violations, we observe a decrease in the equity-to-debt investment ratio of pension plan assets and no significant changes to pension contributions, or pension plans’ assumed rates of returns and discount rates. Our results suggest that the increase in pension deficits arises from the reallocation of pension assets from equity investments to lower-risk and lower-return debt investments. Overall, our findings highlight that the transfer of control rights to bank lenders following covenant violations can influence the wealth of a firm's employees, in the form of higher pension deficits.