Duration of loan arrangement and syndicate organization

Christophe Godlewski

MPRA Paper from University Library of Munich, Germany

Abstract: What is the influence of syndicate organization on the duration of loan arrangement? I answer this question using the survival analysis methodology on a sample of loans from 59 countries over the 1992-2006 period. I find that syndicate size, concentration, reputation, and national diversity clearly matters for the duration of loan arrangement and therefore for borrower satisfaction regarding the speed of obtaining the necessary funding. A syndicate organization adapted to specific agency problems of syndication, with numerous, reputable, and experienced arrangers retaining a larger portion of the loan reduces the duration. The latter is also shorter when the lenders diversity in terms of nationality is weaker.

Keywords: Syndicated loan; syndication process; duration of loan arrangement; agency costs; reputation; experience; nationality; survival analysis (search for similar items in EconPapers)
JEL-codes: C41 F30 G15 G21 G32 (search for similar items in EconPapers)
Date: 2008-09
New Economics Papers: this item is included in nep-ban
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