Credit rationing and relationship lending. Does firm size matter?

Stefano Cenni, Stefano Monferrà, Valentina Salotti, Marco Sangiorgi and Giuseppe Torluccio

Journal of Banking & Finance, 2015, vol. 53, issue C, 249-265

Abstract: Using survey based data, we investigate factors influencing credit rationing within a bank-based financial system. We show that rationing depends on various dimensions of the firm-bank relationships and that the effects of relationship lending on rationing are not identical for different firm size groups. Multiple-banking increases the probability of rationing for small and large firms. Debt concentration with the main bank affects positively smaller firms, while the opposite is true for large companies. The length of the relationship with the main bank decreases the probability of rationing for both groups, but more so for large firms endowed with more bargaining power. Finally, the firm-bank spatial proximity, measured by the headquarters’ vicinity, does not affect the firm’s access to credit.

Keywords: Credit rationing; Relationship banking; SME; Firm financing; Probit sample selection models (search for similar items in EconPapers)
JEL-codes: G20 G21 G32 L23 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (60)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:53:y:2015:i:c:p:249-265

DOI: 10.1016/j.jbankfin.2014.12.010

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