MULTIPLE BANKING RELATIONSHIPS: CHOICE OF THE NUMBER OF MAIN BANKS AND CHOICE OF THE NUMBER OF BANKS

LA MULTIBANCARITÉ DES ENTREPRISES

Catherine Refait-Alexandre

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Abstract: This empirical paper focuses on the total number of banks and the number of main banks (banks that play an important and durable role in the financing) of firms. We test two major results of the theoretical literature: Low quality firms are likely to choose a high number of banks, in order to escape from a close monitoring. Strong multiple banking relationships benefit high quality firms, for they don't pay the infor- mational rent that a single bank would have extracted. We use accounting variables and credit declarations for industrial French firms. We show that the total number of banks increases when the economic profitability of the firm decreases. No important link appears between the performance of the firms and their number of main banks.

Keywords: Banking; multiple banking relationships; lending; Multibancarité; financement; banque (search for similar items in EconPapers)
Date: 2003
Note: View the original document on HAL open archive server: https://hal.science/hal-01391629v1
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Citations: View citations in EconPapers (2)

Published in Revue Economique, 2003, 54 (3), pp.649 à 661. ⟨10.3917/reco.543.0649⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01391629

DOI: 10.3917/reco.543.0649

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