Finance Seminar Franz Hinzen

In today’s Finance Seminar, Franz J. Hinzen from Tuck School of Business at Dartmouth presented „Nonbank Market Power in Leveraged Lending.“ He demonstrated how collateralized loan obligation (CLO) managers exert significant market power in the leveraged loan market, impacting firms' borrowing costs. Their influence arises from information asymmetries, which stem from differences in information access during loan underwriting. To identify these effects, Franz develops a novel instrument based on CLO mergers, providing new insights into the structure of the leveraged loan market.