Does the Policy Lending of the Government Financial Institution Substitute for the Private Lending during the Period of the Credit Crunch? Evidence from loan level data in Japan

Masahiro Sekino and Wako Watanabe

Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: Using the data of individual loan contracts extended by the Japan Finance Corporation for Small and Medium Enterprise (JASME), which is one of the predecessor institutions of the Japan Finance Corporation (JFC) that aimed at lending to small and medium enterprises (SMEs), we examine whether the JASME's lending substituted for the reduced lending supply by private banks during the period of the credit crunch. We find that the JASME made larger loans to the firms whose main bank reduced more lending due to losses on their capital.

Pages: 33 pages
Date: 2014-10
New Economics Papers: this item is included in nep-ban, nep-cba and nep-ent
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eti:dpaper:14063

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