Should I Stay or Should I Go? Firms’ Mobility Across Banks in the Aftermath of the Financial Crisis
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We show that the creation of new bank relationships was effective to ease the credit constraints of firms in the aftermath of the 2008–09 financial crisis: firms that started new bank relationships were able to maintain or even increase their outstanding loans. These firms were generally larger and better performers (higher profitability, investments and growth improved the possibility to start new credit relationships). On the opposite, access to new credit lines was more difficult for small and more opaque firms, for which a long-term relationship with their main bank has been the most effective way to mitigate financing constraints. Finally, geographical proximity matters for bank relationships: the closer the firms are to the lending banks, the lower is the probability of closing a credit relationship and the higher of starting a new one.
KeywordsFinancial crisis Mobility in the credit market Relationship lending
JEL ClassificationG01 G21 G32
The authors wish to thank Monica Andini, Daniele Coin, Cristina Demma, Alessio d’Ignazio, Luca Giaccherini, Giorgio Gobbi, Paolo E. Mistrulli, Stefano Monferrà, Marcello Pagnini, Federico M. Signoretti, the participants at seminars held at the Bank of Italy and at the University of Modena and Reggio Emilia, and two anonymous referees for their helpful comments and suggestions. All remaining errors are the responsibility of the authors alone. The views expressed in this paper are those of the authors and do not necessarily reflect those of the Bank of Italy.
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