Efficiency of Lending Sectoral Allocation in Argentina
AbstractBased on the information of Argentine banks during the period 1998-2005, this paper analyzes if the bank loan portfolio was efficient in the sense of prioritizing the productive sectors with higher growth and stability. The statistical and econometrical response of the study is an unequivocal no. In fact, the portfolios of loans to companies do not seem to change substantially in the short nor the long term. Consequently, they have not reacted to the profitability and risk conditions offered by the different sectors. This issue is relevant from two perspectives: the first one is of private interest and is linked to whether the banks have maximized their benefit. The second perspective is of social interest and is related to the assumption, rejected in this paper, that credit should accompany (and ideally, anticipate) the growth of the most dynamic sectors. This paper depicts some potential causes of this behavior and analyzes policy alternatives.
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Bibliographic InfoArticle provided by Central Bank of Argentina, Economic Research Department in its journal Ensayos Económicos.
Volume (Year): 1 (2007)
Issue (Month): 49 (October - December)
Argentina; banking credit; companies financing; sectoral allocation of credit;
Other versions of this item:
- Ricardo Bebczukegui & Máximo Sangiácomo, 2007. "Efficiency of Lending Sectoral Allocation in Argentina," BCRA Working Paper Series 200719, Central Bank of Argentina, Economic Research Department.
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Joe Peek & Eric S. Rosengren, 2003.
"Unnatural Selection: Perverse Incentives and the Misallocation of Credit in Japan,"
NBER Working Papers
9643, National Bureau of Economic Research, Inc.
- Joe Peek & Eric S. Rosengren, 2005. "Unnatural Selection: Perverse Incentives and the Misallocation of Credit in Japan," American Economic Review, American Economic Association, vol. 95(4), pages 1144-1166, September.
- Schertler, Andrea & Buch, Claudia M. & von Westernhagen, Natalja, 2006.
"Heterogeneity in lending and sectoral growth: evidence from German bank-level data,"
Discussion Paper Series 2: Banking and Financial Studies
2006,04, Deutsche Bundesbank, Research Centre.
- Andrea Schertler & Claudia Buch & Natalja Westernhagen, 2006. "Heterogeneity in lending and sectoral growth: evidence from German bank-level data," International Economics and Economic Policy, Springer, vol. 3(1), pages 43-72, April.
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