Institutional ownership and bond pricing : evidence from China

Wang, Yulin, Zhang, Xueying, Walker, Thomas ORCID: https://orcid.org/0000-0001-7482-0077 and Liedtke, Gerrit ORCID: https://orcid.org/0009-0008-5385-8963 (2026) Institutional ownership and bond pricing : evidence from China. Emerging Markets Review, 70 . DOI 10.1016/j.ememar.2025.101396

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Official URL: https://doi.org/10.1016/j.ememar.2025.101396

Abstract

This paper examines the impact of institutional ownership on the bond yield spreads of publicly traded Chinese firms. Our research results show the presence of a U-shaped, non-linear relationship between the shareholdings of institutional investors and bond yield spreads. Heterogeneity tests reveal differences in the impact of institutional ownership on yield spreads among different types of institutional investors and for firms in which members of the central government stabilization fund, commonly referred to as "national team" institutions, hold shares. Further tests indicate that corporate governance levels and firm performance serve as channels through which institutional shareholders affect bond yield spreads.

Item Type:

Article

Uncontrolled Keywords:

Corporate governance; Investors; Institutional shareholders; Business, Finance; Shareholder activism; Agency costs; Bond yield spread;

JEL classification:

G12 - Asset Pricing; Trading Volume; Bond Interest Rates
G15 - International Financial Markets
G18 - General Financial Markets: Government Policy and Regulation
G31 - Capital Budgeting; Fixed Investment and Inventory Studies; Capacity

Divisions:

Corvinus Institute for Advanced Studies (CIAS)

Subjects:

Business economics
Finance

Funders:

Humanities and Social Science Fund of Ministry of Education of China

Projects:

24YJA790094

DOI:

10.1016/j.ememar.2025.101396

ID Code:

12017