The Effect of Ownership Structure on the Yield Spread of Corporate Bonds

摘要

In the recent recession scenario in Brazil, the credit market experienced shortages, reinforcing the search for alternative sources of credit by companies, such as the issuance of corporate bonds. Among the aspects that may influence the yield spread of companies is the presence of family firms and institutional investors in their ownership structure. Therefore, this study aims at verifying whether the participation of family firms and institutional investors—in the ownership structure of companies—has an impact on the yield spread of their bonds. To verify this impact, this study analyzes 171 companies that carried out 385 bond issuances, from 2010 to 2018. The effects of ownership structure are tested by descriptive statistics, correlation analysis and multiple cross section regression with pooled data. The result shows that the greater the participation of institutional investors in the companies’ ownership structure, the lower the yield spread of their bonds.