Published in:Banque de France Working Paper ; No. 705
Extent:
1 Online-Ressource (48 p)
Language:
English
Origination:
Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 1, 2018 erstellt
Description:
Using a unique panel design that enables to control for bank, firm, market and loan heterogeneities, we confirm that relationship lenders charge higher rates in good times and lower rates in bad times. However, we show that risky single-bank firms do not benefit from this insurance mechanism and are "held-up" by relationship lenders. Local bank competition and higher non-bank finance dependence alleviate this informationmonopolistic behavior. Finally, long-term loans and small, non-trading-oriented and wellcapitalized banks drive the benefits of relationship lending