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Mali, Dafydd 
ORCID: https://orcid.org/0000-0003-3582-2429 and Lim, Hyoungjoo
(2016)
Does corporate ownership affect credit risk?:An investment grade vs non-investment grade firm analysis – evidence from South Korea.
Corporate Ownership and Control, 13 (4).
pp. 38-49.
ISSN 1727-9232
Abstract
A credit rating indicates a firm’s risk of financial default. Using 1) controlling shareholders’ ownership and 2) foreign investors’ ownership as proxies for corporate governance, we investigate whether corporate ownership structure influences a credit rating agencies’ perception of risk. Using a sample of 1,213 KRX firm-year observations, and a t+1 approach, we find that firms with higher foreign ownership have higher credit ratings compared to those with lower foreign ownership. Moreover, we find that higher percentage of shareholder ownership does not affect credit ratings for our initial sample; however, after dividing our sample into investment/non-investment grade samples, we find a positive/negative relation for investment/non-investment firms. The results suggest credit rating agencies perceive the relation between corporate ownership and default risk differently for investment/non-investment grade firms.
| Item Type: | Article |
|---|---|
| Additional Information: | Funding Information: This research was supported by Kyungsung University Research Grants in 2016. Publisher Copyright: © 2016, Virtus Interpress. All Rights Reserved. |
| Uncontrolled Keywords: | corporate ownership,credit risk,investment grade firms,non-investment grade firms,business, management and accounting(all) ,/dk/atira/pure/subjectarea/asjc/1400 |
| Faculty \ School: | Faculty of Social Sciences > Norwich Business School |
| Related URLs: | |
| Depositing User: | LivePure Connector |
| Date Deposited: | 22 Aug 2024 15:30 |
| Last Modified: | 25 Sep 2024 18:03 |
| URI: | https://ueaeprints.uea.ac.uk/id/eprint/96330 |
| DOI: | 10.22495/cocv13i4p4 |
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