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Costs of Financial Distress: The German Evidence

Year:    2009

Author:    Reimund, Carsten, Schwetzler, Bernhard, Zainhofer, Florian

Credit and Capital Markets – Kredit und Kapital, Vol. 42 (2009), Iss. 1 : pp. 93–123

Abstract

Costs of Financial Distress: The German Evidence

In this paper we aim to verify the existence of costs of financial distress (cfd) for a sample of German CDAX firms using an ex-post approach originally due to Opler/Titman (1994). In contrast to this US-based study we do not find a significant interaction between high leverage and distress for German firms: firms in distressed industries with high ex ante leverage do not display lower sales growth than their ex-ante lower levered counterparts. (JEL G32, G33)

Journal Article Details

Publisher Name:    Global Science Press

Language:    English

DOI:    https://doi.org/10.3790/kuk.42.1.93

Credit and Capital Markets – Kredit und Kapital, Vol. 42 (2009), Iss. 1 : pp. 93–123

Published online:    2009-04

AMS Subject Headings:    Duncker & Humblot

Copyright:    COPYRIGHT: © Global Science Press

Pages:    31

Author Details

Reimund, Carsten

Schwetzler, Bernhard

Zainhofer, Florian

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