Item

Does corporate income taxation affect securitization?: Evidence from OECD banks

Gong,Di
; 
Hu,Shiwei
; 
Ligthart,J.E.
Abstract
Corporate income taxation, by affecting the after-tax cost of funding, has implications for a bank’s incentive to securitize. Using a sample of OECD banks over the period 1999–2006, we find that corporate income taxation led to more securitization at banks that are constrained in funding markets, while it did not affect securitization at unconstrained banks. This is consistent with prior theories suggesting that the tax effects of securitization depend on the extent to which banks face funding constraints. Our results suggest that current corporate income tax systems have distorting effects on banks’ securitization decisions.
Description
Date
2015-12
Journal Title
Journal ISSN
Volume Title
Publisher
Collections
Tilburg University Research Output Collection
Show all metadata
Research Projects
Organizational Units
Journal Issue
Keywords
Securitization, SPVs, Corporate income taxes, G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages, H25 - Business Taxes and Subsidies, SDG 17 - Partnerships for the Goals
Citation
Gong, D, Hu, S & Ligthart, J E 2015, 'Does corporate income taxation affect securitization? Evidence from OECD banks', Journal of Financial Services Research, vol. 48, no. 3, pp. 193-213. https://doi.org/10.1007%2Fs10693-014-0210-x
URI
https://hdl.handle.net/20.500.14602/63371
Embedded videos