Gender board diversity and the cost of bank loans

Panagiotis Karavitis, Sotirios Kokas and Serafeim Tsoukas

Journal of Corporate Finance, 2021, vol. 71, issue C

Abstract: We examine the relationship between female board representation and the cost of lending, using a dataset of 13,714 loans from 386 banks matched with 2432 non-financial firms from 1999 to 2013. We find that firms with female directors command lower loan spreads. In addition, female independent directors have a stronger impact on lowering spreads compared to female directors' other attributes. However, as firms build relationships with their lenders this effect becomes less potent. Finally, when we introduce firm-level heterogeneity we document that changes in gender diversity exert a stronger impact on the cost of lending in the case of bank-dependent firms, especially for relationship borrowers.

Keywords: Gender diversity; Board of directors; Bank loans; Relationship lending (search for similar items in EconPapers)
JEL-codes: G21 G30 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (16)

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Working Paper: Gender board diversity and the cost of bank loans (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:71:y:2021:i:c:s0929119920302480

DOI: 10.1016/j.jcorpfin.2020.101804

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