BNET Business Dictionary
Business Definition for: Capital Structure
- the relative proportions of equity capital and debt capital in a company's balance sheet
Additional Resources
- Capital Structure Arbitrage Strategies: Models, Practice and Empirical Evidence
- Capital structure arbitrage strategies currently are the fastest growing sector in the hedge fund market and in proprietary trading departments in large banks. The objective of the thesis is the theoretical and practical background of capital structure arbitrage and hedging strategies, and the empirical evidence of key relationships applying these...
- White papers 2003-11-01
- Horses and Rabbits? Optimal Dynamic Capital Structure From Shareholder and Manager Perspectives
- This paper examines optimal capital structure choice using a dynamic capital structure model that is calibrated to reflect actual firm characteristics. The model uses contingent-claim methods to value interest tax shields, allows for reorganization in bankruptcy, and maintains a long-run target debt/equity ratio by refinancing maturing debt. Using this model...
- White papers 2002-11-01
- Optimal Capital Structure and the Market for Outside Finance in Commercial Real Estate
- When asked about optimal capital structure, the typical response from a commercial real estate investor is "go for it?use as much debt as possible." This answer, while not being necessarily incorrect, is not very informative. This paper seeks to articulate the economics underlying the market for outside finance in commercial...
- White papers 2004-08-01
- Capital Structure & Payout Policy
- The capital structure of a company comprises of the permanent long-term financing of the company, including long-term debt, common stock, preferred stock, and retained earnings. Dividend is a taxable payment declared by a company's board of directors and given to its shareholders out of the company's current or retained earnings....
- Presentations 2003-01-01
- Capital Structure and Stock Returns
- U.S. corporations do not use their debt and equity issuing and repurchasing activities to counteract the mechanistic effects of stock returns on their debt equity ratios. Thus, over 1-5 year horizons, stock returns can explain about 40% of debt ratio dynamics. Although corporate net issuing activity is lively, and although...
- White papers 2004-02-01
- Managerial Incentives and the Efficiency of Capital Structure in U.S. Commercial Banking
- This paper focuses on the effects of managerial entrenchment, to consider how safety-net subsidies and financial distress costs interact with managerial incentives to influence capital structure in U.S. commercial banking. Using cross-sectional data on publicly traded, highest-level U.S. bank holding companies, the paper finds empirical evidence of Marcus' proposition (1984)...
- White papers 2003-04-01
- Risk Management, Capital Budgeting and Capital Structure Policy for Insurers and Reinsurers
- This paper builds on Froot and Stein (1998) in developing a framework for analyzing the risk allocation, capital budgeting, and capital structure decisions facing insurers and reinsurers. The model incorporates three key features: value-maximizing insurers and reinsurers face product market as well as capital market imperfections that give rise to...
- White papers 2003-12-01
- Capital Structure and Inventory Management
- A large literature examines the e?ects of a firm's mixture of debt and equity on its incentives to produce. For nearly 30 years, researchers have examined the consequences of splits between ownership and control agency models and the resulting diversity of claims on cash flow. A related stream of research...
- White papers 2005-08-05
- On The Capital-Structure Implications Of Bankruptcy Codes
- We develop a theoretical model that relates a firm's capital-structure choice to the bankruptcy code under which it operates. We show that optimal capital-structure choices depend on not only the bankruptcy code but also the firm's asset-specificity: firms with high asset-specificity will use a higher degree of leverage under an...
- White papers 2004-06-02
- Designing an [Optimal ] Capital Structure
- A number of developments in the past few years have dramatically changed the framework for evaluating capital structure alternatives for U.S. insured depository institutions of all sizes. First, the implementation of Financial Accounting Standards Board S A number of developments in the past few years have dramatically changed the framework...
- Research articles 2005-09-01
- A new disclosure of information about capital structure required on nonpublic companies.(Accounting & Auditing Update)
- Statement of Financial Accounting Standards SFAS No. 129, 'Disclosure of Information about Capital Structure,' was released by the Financial Accounting Standards Board FASB in February, 1997. Upon examination, the statement appears to be an almost uniStatement of Financial Accounting Standards SFAS No. 129, 'Disclosure of Information about Capital Structure,' was...
- Research articles 1997-10-01
- Microsoft's.(business page on Microsoft's Web site offers tips on building a strong capital structure prior to an IPO)(Brief Article)
- A section of the business page on Microsoft's Web site that was prepared by PricewaterhouseCoopers addresses the building blocks of a strong capital structure. The page provides, through a series of links, a checklist that companies should follow as A section of the business page...
- Research articles 2001-11-01
- Bank of Ayudhya Set to Change Its Capital Structure.
- Bangkok Post, Thailand Knight Ridder/Tribune Business News Mar. 25--Bank of Ayudhya directors yesterday approved a change in the bank's capital structure to meet Securities and Exchange Commission regulations. The bank's registered capital structure will be reduced to 4.08 billion...
- Research articles 2004-03-25
- Risk Management, Capital Budgeting and Capital Structure Policy for Financial Institutions
- We develop a framework for analyzing the capital allocation and capital structure decisions facing financial institutions such as banks. Our model incorporates two key features: i) value-maximizing banks have a well-founded concern with risk management; and ii) not all the risks they face can be frictionlessly hedged in the capital...
- White papers 1997-03-17
- Risk Management, Capital Budgeting and Capital Structure Policy for Financial Institutions: An Integrated Approach
- This white paper basically deals with developing a framework for analyzing the capital allocation and capital structure decisions facing financial institutions such as banks. The basic model incorporates two key features: value-maximizing banks have a well-founded concern with risk management; and not all the risks they face can be frictionless...
- White papers 2002-01-02
- Human Capital, Bankruptcy And Capital Structure
- We derive a firm's optimal capital structure and managerial compensation contract when employees are averse to bearing their own human capital risk, while equity holders can diversify this risk away. In the presence of corporate taxes, our model delivers optimal debt levels consistent with those observed in practice. It also...
- White papers 2006-12-05
- TAG Group reorganises Capital Structure of TAG Heuer SA
- GENEVA--BUSINESS WIRE--December 19, 1995--The TAG Group has reorganised the capital structure of TAG Heuer SA, a leading maker of Swiss sports watches and chronographs.As a result, the TAG Group has retained majority ownership and extended the share capital to management, headed by Christian Viros and CWB Capital Partners, a European...
- Research articles 1995-12-19
- ASML Plans to Optimize Capital Structure: Eurobond Issue Followed by Capital Repayment and Reverse Stock Split.
- M2 PRESSWIRE-31 May 2007-Headline Maker: ASML Plans to Optimize Capital Structure: Eurobond Issue Followed by Capital Repayment and Reverse Stock SplitC1994-2007 M2 COMMUNICATIONS LTD RDATE:31052007 Market Gainer is quickly emerging as the one stop shop for international small-cap investors looking to...
- Research articles 2007-05-31
- Aviall Announces New Capital Structure
- Business Editors DALLAS--BUSINESS WIRE--Dec. 17, 2001 Aviall, Inc. (NYSE:AVL) announces the expansion of its capital structure in conjunction with its new, exclusive ten-year $3 billion Rolls-Royce T56/501-D aftermarket parts supply and support contract awarded today. The Company's new structure includes a $200 million senior secured credit facility...
- Research articles 2001-12-17
- Jazz Technologies, Inc. Announces Securities Repurchases Intended To Simplify Capital Structure and Reduce Debt
- NEWPORT BEACH, Calif. -- Jazz Technologies (Amex:JAZ) today announced several recent repurchases of securities, both in the open market and in privately negotiated transactions, as part of Jazz's continuing effort to simplify its capital structure and reduce its cost of capital. The recent repurchases reduce the number of outstanding common...
- Research articles 2007-09-06
