Panda bonds: opportunity or threat for Europe?




Capital structure, Credit risk, Bond markets, Chinese internationalization


We analyse the effect of panda bonds on indebted firms default probability. The theoretical default probability as a function of debt is evaluated in the Black, Scholes (1973) and Merton (1974) framework for various set of parameters values. We consider as benchmark the prevailing default rates for speculative-grade corporate companies based on the last reports by S&P (2019) and Moody’s (2018).

Author Biography

Patrizia Stucchi, Department of Economics and Statistics

Department of Economics and Statistics, Associate Professor


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