The international bond market is the largest component of the international capital markets. Previous research shows that the liability of foreignness (LOF) imposes significant costs on international debt contracting. The purpose of this study is to examine the impact of foreign institutional shareholders (FISs) on the costs of international debt contracting. While the presence of FISs could lead to a reduction in LOF-related costs, it can also lead to an increase in the costs arising from agency conflicts between shareholders and bondholders. We examine the impact of FISs on the prevalence of restrictive bond covenants using a sample of 956 Yankee bonds from 26 countries over the period 2001–2019. We find a significantly negative relationship between FIS ownership and bond covenants. This inverse relationship is strongest for U.S. institutional ownership, and for covenants designed to mitigate opportunistic behavior such as claim dilution and wealth transfers. We also show that the inverse relationship between U.S. institutional ownership and bond covenants is moderated by variables related to corporate governance, information asymmetry, and agency costs of debt. Additional analyses show that U.S. institutional ownership has a significant pricing effect on Yankee bond investors by lowering an issuer’s cost of borrowing.

国际债券市场是国际资本市场的最大组成部分。先前的研究表明，外国责任（LOF）给国际债务承包带来了巨大的成本。本研究的目的是探讨外国机构股东（FIS）对国际债务承包成本的影响。虽然FIS的存在可能会导致LOF相关成本的减少，但它也可能导致股东和债券持有人之间的代理冲突所产生的成本增加。我们使用 2001 年至 2019 年期间来自 26 个国家的 956 只扬基债券作为样本，研究了 FIS 对限制性债券契约普遍性的影响。我们发现 FIS 所有权与债券契约之间存在显着的负相关关系。这种反向关系对于美国机构所有权以及旨在减轻债权稀释和财富转移等机会主义行为的契约来说最为强烈。我们还表明，美国机构所有权与债券契约之间的负相关关系受到与公司治理、信息不对称和债务代理成本相关的变量的调节。其他分析表明，美国机构所有权通过降低发行人的借贷成本对洋基债券投资者产生显着的定价效应。