The geographic distance of underwriter and bond financing costs: Evidence from China

IF 5.6 2区经济学 Q1 BUSINESS, FINANCE

International Review of Economics & Finance Pub Date : 2025-08-29 DOI:10.1016/j.iref.2025.104569

Xiaojie Qu , Huaping Sun

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Abstract

Geographic distance between underwriters and bond issuers, an objective constraint on companies' access to underwriters in corporate bond financing, influences capital liquidity. Using Chinese credit bonds issued between 2010 and 2022, this paper examines the mechanism through which the geographical distance between underwriters and bond issuers affects bond financing costs (BFCs). The findings indicate that greater geographic distance leads to higher financing costs. This conclusion is robust even after endogeneity concerns are addressed and robustness checks are performed. Moderating effect analysis indicates that underwriters' digital transformation, reputation, and regional marketisation level weaken this effect. The heterogeneity analysis further indicates that the distance premium is more pronounced for bonds underwritten by non-local institutions, those with lower credit ratings, and issuers exhibiting subpar ESG performance. This conclusion enriches theoretical research on the impact of geographic distance on financial markets and provides targeted policy implications for participants and regulators in China's bond market.

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承销商的地理距离与债券融资成本：来自中国的证据

承销商与债券发行人之间的地理距离，是制约公司债券融资与承销商接触的客观因素，影响着资金的流动性。本文以2010年至2022年发行的中国信用债券为研究对象，考察了承销商与债券发行人之间的地理距离对债券融资成本的影响机制。研究结果表明，地理距离越远，融资成本越高。这个结论是稳健的，即使在内生性问题得到解决和稳健性检查执行后。调节效应分析表明，承销商的数字化转型、声誉和区域市场化程度削弱了这种影响。异质性分析进一步表明，对于非本地机构承销的债券、信用评级较低的债券和ESG表现欠佳的发行人，距离溢价更为明显。这一结论丰富了地理距离对金融市场影响的理论研究，并为中国债券市场的参与者和监管者提供了有针对性的政策启示。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

International Review of Economics & Finance Multiple-

CiteScore

7.30

自引率

2.20%

发文量

253

期刊介绍： The International Review of Economics & Finance (IREF) is a scholarly journal devoted to the publication of high quality theoretical and empirical articles in all areas of international economics, macroeconomics and financial economics. Contributions that facilitate the communications between the real and the financial sectors of the economy are of particular interest.