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- Title
Bank Relationships and Firm Profitability.
- Authors
Degryse, Hans; Ongena, Steven
- Abstract
This paper examines how bank relationships affect firm performance. An empirical implication of recent theoretical models is that firms maintaining multiple bank relationships are less profitable than their single-bank peers. We investigate this empirical implication using a data set containing virtually all Norwegian publicly listed firms for the period 1979-1995. We find a robust and economically relevant negative two-way correspondence between the number of relationships and sales profitability. We also find that firms replacing a single relationship are on average smaller and younger than those firms choosing not to replace a single relationship.
- Subjects
BUSINESS enterprises; BANKING industry; PROFITABILITY; FINANCIAL performance; FINANCIAL institutions; FINANCE
- Publication
Financial Management (Wiley-Blackwell), 2001, Vol 30, Issue 1, p9
- ISSN
0046-3892
- Publication type
Article
- DOI
10.2307/3666389