 Does internal competition shape bank lending behavior? Evidence from a Chinese bankLu Xie, Min Zhang, Xiuyuan Song and Lijing Tong Pacific-Basin Finance Journal, 2019, vol. 55, issue C, 169-181 Abstract: Using unique proprietary branch-level lending data obtained from a Chinese national bank, this paper investigates when intra-bank competition intensifies, whether turf wars which arise among parallel credit departments and loan officers shape a bank's lending behavior. Our results show that at both the loan officer level and the credit department level, internal competition is associated with larger loan amounts and loan maturity. These results suggest that employees boost loan volume and establish longer lender-borrower relationships to gain competitive advantages in relative evaluations. We also find that branch presidents with government working experience facilitate the influence of internal competition on aggressive bank lending because they may be more likely to set up tournament incentive schemes for employees. Further results demonstrate that fierce external (inter-bank) competition moderates the association between internal competition and lending behavior. Keywords: Internal competition; Bank lending; Tournaments; Government career experience (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:55:y:2019:i:c:p:169-181 DOI: 10.1016/j.pacfin.2019.03.011 Access Statistics for this article Pacific-Basin Finance Journal is currently edited by K. Chan and S. Ghon Rhee More articles in Pacific-Basin Finance Journal from Elsevier |
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