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Bank lending technologies and credit availability in Europe. What can we learn from the crisis?

Giovanni Ferri, Pierluigi Murro (), Valentina Peruzzi () and Zeno Rotondi ()
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Zeno Rotondi: UniCredit Bank

No wpC17, CERBE Working Papers from CERBE Center for Relationship Banking and Economics

Abstract: Using a unique sample of European manufacturing firms, we empirically investigate how bank lending technologies and soft information production affected firms' credit availability during the 2007-2009 financial crisis. Estimation results indicate that transactional lending technologies increased firms' credit rationing, whereas soft information production mitigated asymmetric information problems and improved firms' access to credit. By looking at the combined effect of lending technologies and soft information, we also provide evidence of the hardening of soft information phenomenon. When soft information was incorporated in transactional lending techniques firms' credit rationing significantly reduced. This result is especially strong for small borrowing firms and for companies matching with large financial insitutions.

Keywords: Lending technologies; Credit rationing; Financial crisis; Soft information (search for similar items in EconPapers)
JEL-codes: G21 D82 G30 O16 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ban and nep-eur
Date: 2018-09
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Working Paper: Bank lending technologies and credit availability in Europe. What can we learn from the crisis? (2017) Downloads
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