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- Title
Bank Lending Networks, Experience, Reputation, and Borrowing Costs: Empirical Evidence from the French Syndicated Lending Market.
- Authors
Godlewski, Christophe J.; Sanditov, Bulat; Burger-Helmchen, Thierry
- Abstract
We investigate the network structure of bank lending markets and evaluate the impact of lenders' network centrality, considered a measure of their experience and reputation, on borrowing costs. We show that the French market for syndicated bank loans is a 'small world' characterized by large local density and short social distances between lenders. Such a network structure allows for better information and resources flows between banks thus enhancing their social captial. We then show that lenders' experience and reputation play a significant role in reducing loan spreads and thus increasing borrower's wealth.
- Subjects
FRANCE; BANK loans; INFRASTRUCTURE (Economics); REPUTATION; CREDIT
- Publication
Journal of Business Finance & Accounting, 2012, Vol 39, Issue 1/2, p113
- ISSN
0306-686X
- Publication type
Article
- DOI
10.1111/j.1468-5957.2011.02269.x