SINGLE VERSUS MULTIPLE BANKING RELATIONSHIPS-EVIDENCE FROM CHINESE LENDING MARKET

Wei Yin and Kent Matthews

The Singapore Economic Review (SER), 2017, vol. 62, issue 01, 227-250

Abstract: Using Chinese firm level data for 2003–2012, this paper determines the factors that drive firms to switch from single bank loan providers to multiple bank loan providers. The results show that large firms are more likely to switch from single to multiple lending relationships. This study finds that medium size and small firms of high quality are more likely to have a single borrower relationship while large and high quality firms are more likely to have multiple bank relationships. Increasing market competition decreases the probability of single bank-firm relationship.

Keywords: Chinese firms; bank switching; single and multiple credit provider (search for similar items in EconPapers)
Date: 2017
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DOI: 10.1142/S0217590816500247

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