research product . 2001

The Ability of Banks to Lend to Informationally Opaque Small Businesses

Berger, Allen N.; Klapper, Leora; Udell, Gregory F.;
Open Access English
  • Published: 01 Aug 2001
  • Publisher: World Bank, Washington, DC
  • Country: United States
Abstract
Consolidation of the banking industry is shifting assets into larger institutions that often operate in many nations. Large international financial institutions are geared toward serving large wholesale customers. How does this affect the banking system's ability to lend to informationally opaque small businesses? The authors test hypotheses about the effects of bank size, foreign ownership, and distress on lending to informationally opaque small firms, using a rich new data set on Argentinean banks, firms, and loans. They also test hypotheses about borrowing from a single bank versus borrowing from several banks. Their results suggest that large and foreign-own...
Subjects
free text keywords: AGRICULTURE, ALLOCATION OF RESOURCES, BALANCE SHEET, BANK ASSETS, BANK CAPITAL, BANK HOLDING COMPANIES, BANK LENDING, BANK MERGERS, BANK PORTFOLIOS, BANK RISK, BANK RISK TAKING, BANK SIZE, BANK STRUCTURE, BANKING CRISES, BANKING CRISIS, BANKING INDUSTRY, BANKING RELATIONSHIPS, BANKING SECTOR, BANKING SYSTEM, BANKING SYSTEMS, BANKS, BASLE ACCORD, BORROWER, BORROWING, BORROWING COSTS, CAPITAL STANDARDS, COMMERCIAL BANKS, COMPARATIVE ADVANTAGE, COMPARATIVE ADVANTAGES, COMPETITORS, CONSOLIDATION, CONTAGION, COSTS OF BORROWING, CREDIT POLICIES, DEBT, DEPOSITORS, DEPOSITS, DISECONOMIES, DISTRESSED BANKS, EMPIRICAL ANALYSIS, EMPLOYMENT, EUROPEAN CENTRAL BANK, FEDERAL RESERVE SYSTEM, FINANCIAL CRISES, FINANCIAL CRISIS, FINANCIAL DISTRESS, FINANCIAL INFORMATION, FINANCIAL INSTITUTIONS, FINANCIAL INTERMEDIARIES, FINANCIAL RATIOS, FINANCIAL SERVICES, FINANCIAL TRANSACTIONS, FOREIGN ENTRY, GDP, INCOME STATEMENTS, INFLATION, INFORMATION ACQUISITION, INSOLVENCY, INSURANCE, INTEREST RATE, INTEREST RATES, LENDER, LENDERS, LENDING BEHAVIOR, LENDING SERVICES, LENDING TERMS, LOAN, LOAN APPLICATIONS, LOAN PORTFOLIOS, LOW INTEREST RATES, MARKET DISCIPLINE, NONPERFORMING LOANS, PATENTS, PREDICTIONS, PRESENT VALUE, PRIVATIZATION, PROFITABILITY, PROPRIETARY INFORMATION, PRUDENTIAL SUPERVISION, RELATIONSHIP LENDING, RISK TAKING, SMALL BANKS, SMALL BUSINESS, SUBSIDIARY, SUPPLIERS, TRADE BARRIERS, TRANSACTIONS COSTS, WEALTH
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