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Long-term debt maturity and financing constraints of SMEs during the Global Financial Crisis

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We use the recent financial crisis to investigate financing constraints of private small and medium-sized enterprises (SMEs) in Belgium. We hypothesize that SMEs with a large proportion of long-term debt maturing at the start of the crisis had difficulties to renew their loans due to the negative credit supply shock, and hence could invest less. We find a substantial variation in the maturity structure of long-term debt. Firms which at the start of the crisis had a larger part of their long-term debt maturing within the next year experienced a significantly larger drop in investments in 2009. This effect is driven by firms which are ex ante more likely to be financially constrained. Consistent with a causal effect of a credit supply shock to corporate investments, we find no effect in “placebo” periods without a negative credit supply shock.

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  1. This survey is addressed to senior loan officers of a representative sample of Euro area banks and is conducted four times a year. Detailed information on the survey and its results are available at:

  2. Detailed information on the survey and its results are available at:

  3. The net percentage of tightening of credit standards is the percentage of banks reporting a tightening minus the percentage of banks who reported they eased credit standards. See for a further discussion of this issue.

  4. Data refer to the nonfinancial business economy (NACE C–I, K) and represent estimates for 2008.

  5. Own calculations based on the Belfirst database used for this study (see Sect. 4.1 for more information). Firms in financial and public sectors are excluded.

  6. We thank an anonymous reviewer for this insight.

  7. Managers of not-for-profit organizations and governmental enterprises may be influenced by government regulation and may have less discretion concerning investments (Smith 1986).

  8. A firm has to deposit the complete format if it has more than 100 employees or if it satisfies at least two of the following criteria: number of employees (yearly average) of at least 50, turnover (value-added tax excluded) of at least 7,300,000 Euro and total assets of at least 3,650,000 Euro (article 15 from Wetboek van Vennootschappen).

  9. Firms with negative equity which have continuous reported losses are likely to be financially distressed. While this will significantly impact their access to external finance, it is not the focus of our study.

  10. We used the Hausman test to determine whether to use fixed-effects or random-effects model.

  11. Percentages on gross capital formation reported in the annual reports of the National Bank of Belgium, available at

  12. See Heyman et al. (2008) for an analysis of the determinants of the debt ratio and debt maturity for a sample of Belgian SMEs.

  13. Young firms also tend to be more financially constrained than older firms (Hadlock and Pierce 2010). However, since most of the firms in our sample are fairly mature firms, age is not a useful measure for financing constraints in this research.


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We are grateful to Jan Annaert, Katrien Craninckx, Marc De Ceuster, Marc Jegers, Armin Schwienbacher and two anonymous reviewers for helpful comments and suggestions. The paper has also benefitted from presentations at the Belgian Entrepreneurship Research Day in Louvain-La-Neuve, the Belgian Financial Research Forum in Antwerp and the Doctoral Research Day at the University of Antwerp.

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Correspondence to Marc Deloof.

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Vermoesen, V., Deloof, M. & Laveren, E. Long-term debt maturity and financing constraints of SMEs during the Global Financial Crisis. Small Bus Econ 41, 433–448 (2013).

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