Showing 1 - 10 of 166
We introduce a new framework for banking competition to protect favorable economic and financial consequences of bank specialness and mitigating unfavorable consequences. We also broaden the existing bank specialness concept. which embodies implicit unnecessary assumptions that would prevent...
Persistent link: https://www.econbiz.de/10014238994
We find that credit lines (CLs) play special roles in syndicated lending, committing lead banks to screen, monitor, and invest in relationships with borrowers. Institutional term loans (ITLs) packaged with CLs have lower interest rate spreads in the primary market and narrower bid-ask spreads in...
Persistent link: https://www.econbiz.de/10012851008
FinTech growth raises questions about its competitive advantages vis-à-vis traditional providers, the relative risks of FinTech products, and real economic effects. We study FinTech platform small business lending, yielding new answers that may apply to FinTech more generally. Findings suggest...
Persistent link: https://www.econbiz.de/10012830316
Bank capital is an important determinant of secondary market liquidity of loans that a bank originates and syndicates. Higher bank capital is associated with significantly narrower loan bid-ask spreads. This effect is stronger when banks are subject to more external financing frictions and...
Persistent link: https://www.econbiz.de/10012834162
Little is known about how socioeconomic characteristics of executive teams affect corporate governance in banking. Exploiting a unique dataset, we show how age, gender, and education composition of executive teams affect risk taking of financial institutions. First, we establish that age,...
Persistent link: https://www.econbiz.de/10010308267
Social capital theory predicts individuals establish social ties based on homophily, i.e., affinities for similar others. We exploit a unique sample to analyze how similarities and social ties affect career outcomes in banking based on age, education, gender, and employment history to examine if...
Persistent link: https://www.econbiz.de/10010308733
This paper offers a possible explanation for the conflicting empirical results in the literature concerning the relation between loan risk and collateral. Specifically, we posit that different economic characteristics or types of collateral pledges may be associated with the empirical dominance...
Persistent link: https://www.econbiz.de/10010292211
The literature has documented a positive relationship between the use of credit scoring for small business loans and small business credit availability, broadly defined. However, this literature is hampered by the fact that all of the studies are based on a single 1998 survey of the very largest...
Persistent link: https://www.econbiz.de/10010292213
An important theoretical literature motivates collateral as a mechanism that mitigates adverse selection, credit rationing, and other inefficiencies that arise when borrowers hold ex ante private information. There is no clear empirical evidence regarding the central implication of this...
Persistent link: https://www.econbiz.de/10010292292
Collateral is a widely used, but not well understood, debt-contracting feature. Two broad strands of theoretical literature explain collateral as arising from the existence of either ex ante private information or ex post incentive problems between borrowers and lenders. However, the extant...
Persistent link: https://www.econbiz.de/10010292349