Interbank competition and information production: Evidence from the interest rate difference

研究成果: Article査読

12 被引用数 (Scopus)

抄録

In this paper, using firm-level cross-sectional data in the US, we report that interest rates on loans extended by inside banks are significantly lower than those on loans extended by outside banks for younger firms in concentrated loan markets, while such loan rate differences are not clearly observed in competitive loan markets. The analytical model presented in this paper predicts that an inside bank is more likely to quote rates lower than those of outside banks to capture a customer in order to gain time to establish exclusive access to the customer's private information, counting on the consequent future rent from informational advantages over rival banks, if the inside bank intends to acquire private information about the borrower's creditworthiness. In light of this prediction, we conclude that the above empirical finding is consistent with the hypothesis that increased competition discourages banks from collecting borrower-specific private information.

本文言語English
ページ(範囲)279-304
ページ数26
ジャーナルJournal of Financial Intermediation
19
2
DOI
出版ステータスPublished - 2010 4
外部発表はい

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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