Contracting Costs, Covenant-Lite Lending, and Reputational Capital
研究发现，尽管宽松契约贷款减少了债权人控制权，但其回收率与传统契约贷款相近，且利差更低；借款企业的私募股权赞助商声誉资本越高，越倾向于选择宽松契约贷款，声誉资本可替代契约降低债务代理成本。
Abstract Using a large sample of leveraged loans, we provide evidence that, despite having fewer creditor control rights, covenant-lite (Cov-Lite) loans have similar recovery rates and significantly lower spreads than loans with maintenance covenants. We find that the propensity to borrow Cov-Lite is related to various proxies for the reputational capital of a borrowing firm’s private equity sponsor. We construct a simple model to illustrate the relationship between reputational capital, covenants, and loan spreads in the leveraged loan market. Our model illustrates how reputational capital can substitute for covenants in mitigating agency costs of debt, leading to lower loan spreads for Cov-Lite loans.