Journal of Corporate Finance Vol. 95 2025
Peer default and EDGAR searches
Abstract
We find that a borrower default causes an increase in investors' EDGAR searches for non-defaulting borrowers that share the same relationship bank. This effect is more pronounced when the lending relationship between the defaulting borrower and the defaulted-upon bank is stronger and when the reliance of non-defaulting borrowers on the defaulted-upon bank is greater. The co-movement of information acquisition for non-defaulting borrowers increases after the peer default, which leads to a co-movement in the issuance of management forecasts and a co-movement in stock returns. In sum, our research supports a network effect of peer defaults on information acquisition.
- DOI
- 10.1016/j.jcorpfin.2025.102891
- Volume
- 95
- Pages
- 102891
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref