Firms' or banks' weakness? Access to finance since the European sovereign debt crisis

Giuseppe Corbisiero and Donata Faccia ()
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Giuseppe Corbisiero: Central Bank of Ireland

No 12/RT/19, Research Technical Papers from Central Bank of Ireland

Abstract: This paper uses a unique dataset where credit rejections experienced by euro area firms are matched with firm and bank characteristics. This allows us to study simultaneously the role that bank weakness and firm weakness had in the credit reduction observed in the euro area during the sovereign debt crisis, and in credit developments characterising the post-crisis recovery. Compared with the existing literature matching borrowers’ and lenders’ characteristics, our dataset provides a better representation of euro area firms of small and medium size. Our findings suggest that, while firm balance sheet factors have been strong determinants of credit rejections, in the crisis period bank weakness made it harder to obtain external finance for firms located in stressed countries of the euro area.

Keywords: Credit supply; Bank lending; Credit crunch; European sovereign debt crisis. (search for similar items in EconPapers)
JEL-codes: E44 F36 G01 G21 (search for similar items in EconPapers)
Date: 2019-10
New Economics Papers: this item is included in nep-ban, nep-cfn, nep-eec and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://centralbank.ie/docs/default-source/publica ... faccia).pdf?sfvrsn=6 (application/pdf)

Related works:
Working Paper: Firm or bank weakness? Access to finance since the European sovereign debt crisis (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:cbi:wpaper:12/rt/19

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