We question the validity of the broad consensus in the literature that loans are unique relative to other financial contracts. Research in this area is event-study driven and implicitly assumes that relatively small samples of loan announcements adequately represent all bank loans. Our analysis...

We analyze the factors that influence the decision to secure a commercial loan. We find evidence that variables reflecting adverse selection, moral hazard, and the prospects for default all affect the likelihood a loan will be collateralized. We find no evidence in favor of the predictions of...

We examine the size and composition of commercial lending syndicates. Syndicates are smaller and more concentrated when there is little information about the borrower, when credit risk is relatively high, and when a loan is secured. This suggests syndicates are structured to enhance monitoring...