Quirin Fleckenstein
I am an assistant professor in finance at HEC Paris. My research areas are Macro-Finance, Financial Intermediation, and Corporate Finance.
Contact: fleckenstein@hec.fr
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Research
Publications
Nonbank Lending and Credit Cyclicality with Manasa Gopal, German Gutierrez, and Sebastian Hillenbrand
Forthcoming, Review of Financial Studies
Abstract:
We study the contribution of banks and nonbanks to cyclical fluctuations in the supply of syndicated loans. We find that a reduction in nonbank lending explains most of the contraction in syndicated credit and the associated employment losses during the Global Financial Crisis, while banks’ contribution is small. Looking over multiple cycles, nonbanks’ credit supply is roughly three times more cyclical than banks’, suggesting that nonbanks are the main drivers of syndicated lending cycles. A model in which government support stabilizes bank funding can explain the higher cyclicality of nonbanks.
Do Lead Arrangers Retain Their Lead Shares? with Kristian Blickle, Sebastian Hillenbrand, and Anthony Saunders
Forthcoming, Journal of Finance
Best Paper Award Muenster Banking Workshop
Abstract:
We examine how lead arrangers’ ownership stakes in syndicated loans evolve after origination, complementing prior research on lead shares at origination. Lead arrangers tend to retain shares in bank-held loans but frequently sell shares in loans distributed to institutional investors, typically within days of origination. The frequency of these loan sales has increased over time, aligning with the rise of the originate-to-distribute model. Importantly, we find no evidence that loan sales are associated with worse performance. Additional evidence suggests that exposure through other loans, temporary retention during syndication, and reputation concerns help mitigate information asymmetries in the syndicated loan market.
Working Papers
Intermediary Frictions and the Corporate Credit Cycle: Evidence From CLOs
Abstract:
I study financing frictions in collateralized loan obligations (CLOs), highly leveraged, actively managed credit funds. I provide evidence that debt-equity conflicts distort CLOs’ trading decisions, which increases their cost of debt, particularly when equity is low. This financing friction intensifies in volatile periods, raising debt costs and reducing new issuance. While CLO contracts adjust by limiting managerial discretion and increasing equity funding, these responses are costly and only partially offset the effect. Back-of-the-envelope estimates suggest a substantial impact on issuance. The results show that debt-equity conflicts can meaningfully influence investment decisions, financing costs, and credit supply dynamics in leveraged intermediaries.
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