Concentration in bank lending: What do we learn from European comparisons?

Christophe Godlewski and Ydriss Ziane

Brussels Economic Review, 2010, vol. 53, issue 3/4, 441-455

Abstract: We empirically investigate the determinants of lenders concentration providing bank loans to European borrowers. We analyze the influence of loan and borrower characteristics but also legal enforcement variables that are expected to influence the financial and strategic decisions related to bank lending concentration. We find that firms tend to diversify sources of financing by reducing concentration when their level of quality is higher and both asymmetric information and the risk of early liquidation are minimal. Furthermore, lenders’ monitoring appears to be an important feature of lending concentration, particularly in order to prevent private benefits extraction by insiders in legal environment where shareholders benefit from better protections.

Keywords: Financial intermediation; Bank lending; Creditor concentration; Information asymmetry; Agency costs; Europe (search for similar items in EconPapers)
JEL-codes: G21 G32 G33 (search for similar items in EconPapers)
Date: 2010
Note: Special Issue "26th Symposium on Money, Banking and Finance" Guest Editors :Sébastien Galanti and Grégory Levieuge
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://dipot.ulb.ac.be/dspace/bitstream/2013/8115 ... EGODLEWSKI-ZIANE.pdf 7-ARTICLE GODLEWSKI-ZIANE (application/pdf)

Related works:
Working Paper: Concentration in bank lending, what do we learn from European comparisons ? (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bxr:bxrceb:2013/81157

Ordering information: This journal article can be ordered from
http://hdl.handle.ne ... ulb.ac.be:2013/81157

Access Statistics for this article

More articles in Brussels Economic Review from ULB -- Universite Libre de Bruxelles Contact information at EDIRC.
Bibliographic data for series maintained by Benoit Pauwels ().