Multiple banking relationships: do SMEs mistrust their banks?

Catherine Refait-Alexandre and Stéphanie Serve

No 2016-02, Working Papers from CRESE

Abstract: This article focuses on the use of multiple banking relationships by SMEs, a key issue given their strong dependence on bank financing in a context of increasing financial constraints and higher risk of credit rationing since the crisis. We investigate whether the use of multiple banking relationships is explained by firms' characteristics or by the quality of the banking relationship. We exploit the results of an original survey conducted on a sample of French SMEs in December 2012. According to the traditional theoretical framework of multiple banking, we find that older, bigger, and betterperforming firms are more likely to access multiple banking relationships. We further find that innovative firms are more likely to engage in multiple banking relationships. We also highlight the explanatory power of an alternative model based on the quality of banking relationship: when the manager trusts its main bank, or when he is closer to his loan officer, the firm will be less likely to engage in multiple banking relationships.

Keywords: multiple banking relationships; trust; credit rationing; financial crisis (search for similar items in EconPapers)
JEL-codes: G21 G32 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2016-01
New Economics Papers: this item is included in nep-ban, nep-cfn, nep-ent and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://crese.univ-fcomte.fr/uploads/wp/WP-2016-02.pdf First version, 2016 (application/pdf)

Related works:
Journal Article: Multiple banking relationships: Do SMEs mistrust their banks? (2020)
Working Paper: Multiple banking relationships: do SMEs mistrust their banks? (2020)
Working Paper: Multiple banking relationships: do SMEs mistrust their banks? (2017)
Working Paper: Multiple Banking Relationships: Do SMEs Mistrust Their Banks? (2016)
Working Paper: Multiple banking relationships: do SMEs mistrust their banks? (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:crb:wpaper:2016-02

Access Statistics for this paper

More papers in Working Papers from CRESE Contact information at EDIRC.
Bibliographic data for series maintained by Lauent Kondratuk ().