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Relationship between financing sources and the capital structure of large Brazilian companies

Published: Dec 27, 2022
Volume: 20
Keywords: Capital structure Financing sources Leverage BNDES Capital markets

Authors

João Paulo Augusto Eça
Universidade de São Paulo
Tatiane Del Arco Franzotti
Universidade de São Paulo
Maurício Ribeiro do Valle
Universidade de São Paulo

Abstract

We analyze the capital structure of large public companies in Brazil, and the relationship of financing sources to these companies' leverage. Sources of financing are classified into market lines and differentiated lines, and by funding currency. Using panel data for 99 Brazilian firms between 2001 and 2019, we find a relationship between financing source and capital structure: companies that use differentiated lines, which have subsidized interest rates, are less leveraged than companies using market lines. The debt currency does not explain companies' financing.

How to cite

João Paulo Augusto Eça, Tatiane Del Arco Franzotti, Maurício Ribeiro do Valle. Relationship between financing sources and the capital structure of large Brazilian companies. Brazilian Review of Finance, v. 20, n. 4, 2022. p. 61-82. DOI: 10.12660/rbfin.v20n4.2022.85587.