International Shock Transmission after the Lehman Brothers Collapse. Evidence from Syndicated Lending

Ralph De Haas and Neeltje Van Horen ()

MPRA Paper from University Library of Munich, Germany

Abstract: After Lehman Brothers filed for bankruptcy in September 2008, cross-border bank lending contracted sharply. To explain the severity and variation in this contraction, we analyze detailed data on cross-border syndicated lending by 75 banks to 59 countries. We find that banks that had to write down sub-prime assets, refinance large amounts of long-term debt, and experienced sharp declines in their market-to-book ratio, transmitted these shocks across borders by curtailing their lending abroad. While shocked banks differentiated between countries in much the same way as less constrained banks, they restricted their lending more to small borrowers.

Keywords: Cross-border lending; bank-funding shocks; crisis transmission (search for similar items in EconPapers)
JEL-codes: E51 F36 G21 (search for similar items in EconPapers)
Date: 2012-01-17
New Economics Papers: this item is included in nep-ban, nep-fmk and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (155)

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Journal Article: International Shock Transmission after the Lehman Brothers Collapse: Evidence from Syndicated Lending (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:36001

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