Firm and country determinants of debt maturity. New international evidence

Abstract

This paper shows the influence of firm‐ and country‐level determinants on debt maturity structure for 39 countries during the period 1995–2012. Efficiency of the legal system, protection of creditors' rights and bank concentration show a positive relationship with debt maturity, while the weight of banks in the economy has a negative effect on firm debt maturity. The positive influence of bank concentration on corporate debt maturity reveals that creditors are more likely to extend debt maturity when the bank credit market is concentrated. This positive effect of bank concentration is reduced in high quality institutional environments. Moreover, the effects of bank concentration and the weight of banks in the economy on corporate debt maturity are higher in smaller firms.