EconPapers    
Economics at your fingertips  
 

Trust and Uncertainty: A Study of Bank Lending to Private SMEs in Vietnam

Thang Nguyen, Ngoc T. B. Le and Nick J. Freeman

Asia Pacific Business Review, 2006, vol. 12, issue 4, 547-568

Abstract: This research explores the question of how -- in the absence of institutions that legitimate markets, contracts, and private property, and the lack of business data -- banks make loan decisions to the private sector. We conducted in-depth interviews with 23 bankers of state-owned and private banks in Vietnam. Our results suggests that in the absence of effective market institutions and business data, banks in Vietnam face considerable uncertainties (rather than risks) in lending to private businesses. Consequently, banks employ a combination of uncertainty avoidance, and reliance on trust, in lending to their private business clients. We also found a strong association between types of banks (state and privately owned) and uncertainty strategies, as well as strong relationships between types of banks and trust development mechanisms.

Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9) Track citations by RSS feed

Downloads: (external link)
http://hdl.handle.net/10.1080/13602380600571260 (text/html)
Access to full text is restricted to subscribers.

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:taf:apbizr:v:12:y:2006:i:4:p:547-568

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/FAPB20

DOI: 10.1080/13602380600571260

Access Statistics for this article

Asia Pacific Business Review is currently edited by Professor Chris Rowley and Malcolm Warner

More articles in Asia Pacific Business Review from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().

 
Page updated 2020-10-30
Handle: RePEc:taf:apbizr:v:12:y:2006:i:4:p:547-568