EconPapers    
Economics at your fingertips  
 

Development banks and the syndicate structure: Evidence from a world sample

Degl’Innocenti, Marta, Marco Frigerio () and Si Zhou ()

Journal of Empirical Finance, 2022, vol. 66, issue C, 99-120

Abstract: Do development banks influence syndicate structure? Using a global dataset across 48 countries of 11,949 syndicated loans from 2001 to 2016, we show that lead banks decrease their loan shares and form less concentrated structures in mixed syndicates that include both development banks and private-sector banks as participant lenders. In line with the social view on the role of development banks, we find that such an effect is stronger during periods of financial instability, particularly for the green industry and in the case of borrowers that are financially constrained. Conversely, we do not find any evidence that mixed syndicates exhibit a different syndicate structure for political distortions. Lastly, we find that mixed syndicates are not associated with higher covenant violations and an increasing of the borrowers’ risk profile after the loan origination. Our results are robust when accounting for, among others, relationship lending, asymmetric information within the syndicate, lenders’ lending expertise, borrowers’ opacity, types of loan, and ranking hierarchy in the syndicate.

Keywords: Syndicated loan market; Syndicate structure; Development banks; Loan-level data (search for similar items in EconPapers)
JEL-codes: D82 G21 G28 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S092753982200010X
Full text for ScienceDirect subscribers only

Related works:
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:eee:empfin:v:66:y:2022:i:c:p:99-120

DOI: 10.1016/j.jempfin.2022.01.002

Access Statistics for this article

Journal of Empirical Finance is currently edited by R. T. Baillie, F. C. Palm, Th. J. Vermaelen and C. C. P. Wolff

More articles in Journal of Empirical Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2022-09-28
Handle: RePEc:eee:empfin:v:66:y:2022:i:c:p:99-120