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NEWSLETTER of August 9, 2019

 

The following content has been added at finexpert:


Studies > Performance

Bain & Company

WHY BETTER PERFORMANCE MANAGEMENT SPURS BANKS TO DELIVER MORE VALUE

Large banks in Europe and Asia-Pacific are under pressure from investors to deliver more value and from regulators to justify their business models. Their returns on equity and price-to-book ratios lag their peers in North America. For most banks, the way they manage performance is not up to the task. Too often, performance management is fragmented among business units and regions, which makes it difficult to optimize profitability or create value for the entire group. >more

Studies > M & A

Mergermarket

THE RISE OF THE MEGA DEAL

Mergermarket is pleased to present "The rise of the mega deal", published in association with Imprima. 2018 saw 39 mega deals globally (deals with transaction value above US$10 billion), the second highest number of such deals since the financial crisis. And while the first quarter of the year has seen a dip in M&A activity globally, there have still been 16 mega deals totalling US$535.3 billion in deal value. With this in mind, we asked five experts in M&A from the fields of investment banking, technology and academia to weigh in on trends in mega deal activity and the challenges facing dealmakers at the top end of the market. >more

Studies > Risk Management

PwC

2019 GLOBAL TREASURY BENCHMARKING SURVEY

Corporate treasury functions are embarking on a range of initiatives that unlock value for the organisation by embracing innovation. These transformations support all areas of the treasurer’s agenda, with the overarching goal of enabling treasury to better deliver on increasing demands to provide strategic insight. What do changing priorities and evolving technology mean for the treasury function of tomorrow? PwC’s 2019 Global Treasury Benchmarking Study cultivated the input of over 230 treasury and finance executives in 37 countries to explore the treasury agenda and provide insight into what’s next on the digital treasury journey. >more

Studies > Macro

Deutsche Bank Research

GLOBAL MONETARY MEDICINE ON THE WAY

Read on for a Deutsche Bank Research discussion of the recent shift in central bank policy and the implications for the global economy. The report also outlines key recent/upcoming political developments (new European leadership, Brexit, trade war, etc.), major risks in 2019, and updates cross asset market views. >more


Research Papers > Corporate Finance

DO MULTIPLE CREDIT RATINGS REDUCE MONEY LEFT ON THE TABLE? EVIDENCE FROM U.S. IPOS

Marc Goergen, Dimitrios Gounopoulos, and Panagiotis Koutroumpis
2019
We examine initial public offerings (IPOs) with single, multiple, and no credit ratings. We document a beneficial effect of credit ratings provided by the three main credit rating agencies on IPO underpricing, which is amplified by the existence of multiple credit ratings. Multiple ratings also reduce the extent of filing price revisions. Credit rating levels matter for IPOs with more than one rating but not for those with a single rating. Firms with multiple credit ratings also have higher probabilities of survival than those with a single or no rating. Finally, IPOs awarded a first credit rating on the borderline between investment and non-investment grade are more likely to seek an additional rating. >more

Research Papers  > Alternative Investments

VENTURE CAPITAL CONTRACTS

Michael Ewens, Alexander S. Gorbenko, and Arthur G. Korteweg
2019
We estimate the impact of venture capital (VC) contract terms on startup outcomes and the split of value between the entrepreneur and investor, accounting for endogenous selection via a novel dynamic search and matching model. The estimation uses a new, large data set of first financing rounds of startup companies. Consistent with efficient contracting theories, there is an optimal equity split between agents that maximizes the probability of success. However, VCs use their bargaining power to receive more investor-friendly terms compared to the contract that maximizes startup values. Better VCs still benefit the startup and the entrepreneur, due to their positive value creation. Counterfactual exercises show that eliminating certain contract terms benefits entrepreneurs and enables low-quality entrepreneurs to finance their startups more quickly, increasing the number of deals in the market. Lowering search frictions shifts the bargaining power to VCs and benefits them at the expense of entrepreneurs. The results show that selection of agents into deals is a first-order factor to take into account in studies of contracting. >more