 National development banks and loan contract terms: Evidence from syndicated loansDi Gong, Jiajun Xu and Jianye Yan Journal of International Money and Finance, 2023, vol. 130, issue C Abstract: In this study, we examine whether national development banks (NDBs) fill market gaps in the syndicated loan market. Existing theories make conflicting arguments, but little empirical research has systematically investigated the roles of NDBs in credit markets. To fill the gap, we build a novel and comprehensive list of NDBs worldwide. Using a large, international sample of non-sovereign syndicated loans over the past two decades, we find that loans with NDBs have longer maturity and higher loan spreads than those without. These results hold using the propensity score matching technique and the treatment effects model that account for the endogenous selection of NDBs. We also find that NDBs provide financial support for credit-rationed borrowers and play a countercyclical role during global liquidity cycles. Our study implies that NDBs address market failures in the syndicated loan market. Keywords: National development banks; Syndicated loans; Contract terms (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jimfin:v:130:y:2023:i:c:s0261560622001668 DOI: 10.1016/j.jimonfin.2022.102763 Access Statistics for this article Journal of International Money and Finance is currently edited by J. R. Lothian More articles in Journal of International Money and Finance from Elsevier |
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