We test the implications of Flannery's (1986) and Diamond's (1991) models concerning the effects of risk and asymmetric … information in determining debt maturity, and we examine the overall importance of informational asymmetries in debt maturity … choices. We employ data on over 6,000 commercial loans from 53 large U.S. banks. Our results for low-risk firms are consistent …

provide modest support for all three hypotheses that there was an increase in toughness during the credit crunch period (1989 …