Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments April 20, 2013 erstellt
Description:
We analyze whether relationship lending reduces borrowers' probability of default and, if so, whether this beneficial effect also applies to borrowers who are more exposed to the economic downturn. By using unique, matched data of 43,000 firms and their lending institutions between 2008 and 2010, we document that the probability that a firm becomes distressed decreases if the creditor concentration is high and if the duration of bank-firm relationships is long. While these results appear to support the beneficial effect of relationship lending practices, we note that the organizational distance of banks also matters both as a determinant of loan distress and loan downgrading. The results are stronger for smaller firms