Search results for: Pedro Martínez-Solano

Items from 1 to 15 out of 15 results

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Private family firms, generations and bank debt

Nieves Lidia Díaz‐Díaz, Pedro J. García‐Teruel, Pedro Martínez‐Solano

Accounting & Finance > 63 > 3 > 3043 - 3075

This paper focuses on the use of bank debt by private family firms and whether it is higher for the first generations of family businesses than for their descendants and subsequent generations. We use a unique hand‐collected data set of 4,041 private Spanish firms for the years 2004 to 2013. We find statistical evidence that family‐controlled firms make greater use of bank credit. Moreover, we show...

article

Cash holdings in SMEs: speed of adjustment, growth and financing

Cristina Martínez-Sola, Pedro J. García-Teruel, Pedro Martínez-Solano

Small Business Economics > 2018 > 51 > 4 > 823-842

This paper studies the effect of growth opportunities, financial constraints and financial distress on the speed of adjustment of small and medium-sized enterprises (SMEs) to their target cash holdings. We use a sample of Spanish SMEs from the period of 1998 to 2012. The results support the existence of a target cash holding level to which small firms attempt to converge. Additionally, consistent...

article

Debt maturity structure in private firms: Does the family control matter?

Nieves Lidia Díaz-Díaz, Pedro J. García-Teruel, Pedro Martínez-Solano

Journal of Corporate Finance > 2016 > 37 > C > 393-411

This research studies the effect of family control on the debt maturity structure of private firms. It uses a sample of unlisted Spanish firms for the period 2004–2013. Our results indicate that family firms get better access to long-term debt, even when exercising control by pyramid structures. However, the presence of a second largest family shareholder has a negative effect on debt maturity. Moreover,...

article

Working capital management, corporate performance, and financial constraints

Sonia Baños-Caballero, Pedro J. García-Teruel, Pedro Martínez-Solano

Journal of Business Research > 2014 > 67 > 3 > 332-338

This paper examines the linkage between working capital management and corporate performance for a sample of non-financial UK companies. In contrast to previous studies, the findings provide strong support for an inverted U-shaped relation between investment in working capital and firm performance, which implies the existence of an optimal level of investment in working capital that balances costs...

article

Trade credit and SME profitability

Cristina Martínez-Sola, Pedro J. García-Teruel, Pedro Martínez-Solano

Small Business Economics > 2014 > 42 > 3 > 561-577

Financial literature discusses the motives for trade credit provision by suppliers in depth. However, there is no empirical evidence of the effect of granting trade credit on the profitability of small and medium-sized firms. We examine the profitability implications of providing financing to customers for a sample of 11,337 Spanish manufacturing SMEs during the 2000–2007 period. This article also...

article

The role of accruals quality in the access to bank debt

Pedro J. García-Teruel, Pedro Martínez-Solano, Juan Pedro Sánchez-Ballesta

Journal of Banking and Finance > 2014 > 38 > Complete > 186-193

This work analyses the effect of accruals quality in the access of firms to bank debt in a panel data of SME Spanish firms. The results show a positive association between accruals quality and bank debt, even when controlling for other determinants of bank debt and for possible endogeneity between bank debt and accruals quality, which suggests that higher precision of earnings reduces information...

article

Trade credit policy and firm value

Cristina Martínez‐Sola, Pedro J. García‐Teruel, Pedro Martínez‐Solano

Accounting & Finance > 53 > 3 > 791 - 808

This manuscript studies the shape of the relation between firm value and trade credit for a sample of Spanish listed firms in the period 2001 to 2007. Considering the trade‐off between benefits and costs of investing in trade credit, we estimate a non‐linear relationship between accounts receivable and firm value. As expected, the results obtained show a positive relation between firm value and trade...

article

How does working capital management affect the profitability of Spanish SMEs?

Sonia Baños-Caballero, Pedro J. García-Teruel, Pedro Martínez-Solano

Small Business Economics > 2012 > 39 > 2 > 517-529

This paper analyzes the relation between working capital management and profitability for small and medium-sized enterprises (SMEs) by controlling for unobservable heterogeneity and possible endogeneity. Unlike previous studies, we examine a non-linear relation between these two variables. Our results show that there is a non-monotonic (concave) relationship between working capital level and firm...

article

Working capital management in SMEs

Sonia Baños‐Caballero, Pedro J. García‐Teruel, Pedro Martínez‐Solano

Accounting & Finance > 50 > 3 > 511 - 527

This paper analyses the determinants of Cash Conversion Cycle (CCC) for small‐ and medium‐sized firms. It has been found that these firms have a target CCC length to which they attempt to converge, and that they try to adjust to their target quickly. The results also show that it is longer for older firms and companies with greater cash flows. In contrast, firms with more growth opportunities, and...

article

Accruals Quality and Debt Maturity Structure

PEDRO J. GARCÍA‐TERUEL, PEDRO MARTÍNEZ‐SOLANO, JUAN P. SÁNCHEZ‐BALLESTA

Abacus > 46 > 2 > 188 - 210

In this paper we use panel data and GMM estimation to examine the effect of accounting quality on debt maturity structure in a bank‐based financial system and show that, even after controlling for unobservable heterogeneity, endogeneity, variables reflecting operating volatility and the cost of debt, firms with poor accounting quality face a shorter debt term than firms with higher accounting quality...

article

A Dynamic Approach to Accounts Receivable: a Study of Spanish SMEs

Pedro J. García‐Teruel, Pedro Martínez‐Solano

European Financial Management > 16 > 3 > 400 - 421

The main objective of this paper is to extend the literature on the granting of trade credit. The focus is to test whether the accounts receivable decisions follow a model of partial adjustment. To do that, we use a sample of 2,922 Spanish SMEs. Using a dynamic panel data model and employing the GMM method of estimation we control for unobservable heterogeneity and for potential endogeneity problems. The results reveal that firms have a target level of accounts receivable and take decisions in order to achieve that level. In addition, we find that sales growth (if positive), the size of the firms, their capacity to generate internal funds and get short term financing, and economic growth are important in determining trade credit granted by firms....

article

Relationship lending and SME financing in the continental European bank-based system

Ginés Hernández-Cánovas, Pedro Martínez-Solano

Small Business Economics > 2010 > 34 > 4 > 465-482

This paper analyzes the relationship between banks and SMEs in the continental European bank-based system. We find that SMEs with longer bank relationships have enhanced access to loans, but at the same time they bear a higher cost for their debt. We also find that firms maintaining two bank relationships get the cheapest debt, which establishes a limit for the degree of concentration of bank relationships...

article

Ownership structure and debt maturity: new evidence from Spain

Pedro J. García-Teruel, Pedro Martínez-Solano

Review of Quantitative Finance and Accounting > 2010 > 35 > 4 > 473-491

This paper builds upon the scarce evidence about the relationship between ownership structure and debt maturity using a sample of listed Spanish firms. Our results suggest that there is a non monotonic (concave) relationship between long term debt and managerial ownership. Long term debt and managerial ownership relate positively at low levels of managerial ownership and negatively at higher levels...

article

A dynamic perspective on the determinants of accounts payable

Pedro J. García-Teruel, Pedro Martínez-Solano

Review of Quantitative Finance and Accounting > 2010 > 34 > 4 > 439-457

Companies can use supplier financing as a source of short-term finance. The main objective of this paper is to extend the literature on the determinants of accounts payable and to test whether the accounts payable follow a model of partial adjustment. To do this, we use a sample of 3,589 small and medium sized firms in the UK. Using a dynamic panel data model and employing GMM method of estimation...

article

Effect of the Number of Banking Relationships on Credit Availability: Evidence from Panel Data of Spanish Small Firms

Ginés Hernández-Cánovas, Pedro Martínez-Solano

Small Business Economics > 2007 > 28 > 1 > 37-53

This paper investigates how the choice between single or multiple banking relationships affects credit availability for a complete panel of small and medium-sized Spanish firms. The results seem to indicate the existence of rationing, since a substitution relation has been found between trade and bank credit. We also analyse the relationship between the level of indebtedness and the interest rate...

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