Abstract:
Based on 615 pairs of paired-firms from 2007 to 2011, the paper finds: shareholding in financial institutions not only can bring more debt capitals to holding firms, including short-term debt and long-term debt, but also can change their debt structure by increasing the short-term debt financing and reducing the using of long-term debt. Besides, the influence of investing in financial institutions on debt financing and debt structure is more evident in non-state-own enterprises comparing to the state-owned enterprises. Further dividing the financial institutions into two groups, we find that the influence of shareholding in financial institutions on firms’ debt financing and debt structure is due to the shareholding in non-bank financial institutions rather than shareholding in banks.
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