Explores the role of bank-borrower relationships in small firm finance. Focus is on the availability and terms of lines … length of the relationship between the lender and the borrower. The requirement that a firm pledge collateral is less likely … for older firms who have had long relationships with the bank. Overall, the analysis shows that the longer the …

estate collateral. This is most pronounced for opaque (for example, very young) firms. Through an extension to our model and … our choice of specification, we show that our findings are most consistent with a collateral-value-based credit supply …