This note validates the key results of prior studies of bank loan announcement effects using a common data set drawn from the Canadian capital market. Announcements of bank loans are associated with positive abnormal returns significantly higher than for private placements and loan syndications. Announcement effects are most pronounced when monitoring is most intense and when an announcement signals that the bank's private information is favorable. Conclusions of prior studies on bank loan announcements, conducted exclusively on US data, are robust for a different banking system.

This paper investigates what induces small firms in an emerging market economy to borrow dollar credit from domestic banks. Our data are from a unique survey of firms in Lebanon. The findings complement studies of large firms with foreign currency loans from foreign lenders. Exporters, naturally hedged against currency risk, are more likely to incur dollar debt. Firms also partly hedge themselves by passing currency risk to customers and suppliers. Less opaque firms with easily verifiable collateral and higher net worth are more likely to access dollar credit. Firms reliant on formal financing (banks and supplier credit) are more likely to contract dollar debt than firms reliant on informal financing (family, friends and moneylenders). Bank relationships, however, do not increase the dollar debt likelihood. And finally, profitable firms are less likely to have dollar debt. Information frictions and limited collateral, therefore, constrain dollar credit even when it is intermediated domestically.