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The evolution of bank lending to small business

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  • Joe Peek
  • Eric Rosengren

Abstract

This article examines how consolidation, along with the use of credit-scoring models for lending, may be reflected in recent patterns of small business lending by banks. The authors find that the market for small business lending has been substantially influenced both by the wave of bank consolidations and by the adoption of efficiency-enhancing information technologies at banks.

Suggested Citation

  • Joe Peek & Eric Rosengren, 1998. "The evolution of bank lending to small business," New England Economic Review, Federal Reserve Bank of Boston, issue Mar, pages 27-36.
    • Handle: RePEc:fip:fedbne:y:1998:i:mar:p:27-36
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    References listed on IDEAS

    as
    1. William R. Keeton, 1995. "Multi-office bank lending to small businesses: some new evidence," Economic Review, Federal Reserve Bank of Kansas City, vol. 80(Q II), pages 45-57.
    2. Berger, Allen N. & Saunders, Anthony & Scalise, Joseph M. & Udell, Gregory F., 1998. "The effects of bank mergers and acquisitions on small business lending," Journal of Financial Economics, Elsevier, vol. 50(2), pages 187-229, November.
    3. Allen N. Berger & Anil K. Kashyap & Joseph M. Scalise, 1995. "The Transformation of the U.S. Banking Industry: What a Long, Strange Trips It's Been," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(2), pages 55-218.
    4. Philip E. Strahan & James Weston, 1996. "Small business lending and bank consolidation: is there cause for concern?," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 2(Mar).
    5. Keeton, William R., 1995. "Multi-Office Bank Lending To Small Businesses: Some New Evidence," 1995 Regional Committee NC-207, October 16-17, 1995, Kansas City, Missouri 131493, Regional Research Committee NC-1014: Agricultural and Rural Finance Markets in Transition.
    6. Nicholas A. Walraven, 1997. "Small business lending by banks involved in mergers," Finance and Economics Discussion Series 1997-25, Board of Governors of the Federal Reserve System (U.S.).
    7. Joe Peek & Eric Rosengren, 1995. "The effects of interstate branching on small business lending," Proceedings 462, Federal Reserve Bank of Chicago.
    8. Loretta J. Mester, 1997. "What's the point of credit scoring?," Business Review, Federal Reserve Bank of Philadelphia, issue Sep, pages 3-16.
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    Cited by:

    1. Alexander Cobham, "undated". "The Financing and Technology Decisions of SMEs: II. Technology and Policy," QEH Working Papers qehwps25, Queen Elizabeth House, University of Oxford.
    2. Loretta J. Mester, 1999. "Banking industry's consolidation: what's a small business to do?," Business Review, Federal Reserve Bank of Philadelphia, issue Jan, pages 3-16.
    3. Alethea Abuyuan & Glenn Yago & Betsy Zeidman, 2007. "A history of emerging domestic markets," Community Development Innovation Review, Federal Reserve Bank of San Francisco, issue 1, pages 1-22.
    4. Susan White HAAG, 2002. "Community Reinvestment: A Review of Urban Outcomes and Challenges," International Regional Science Review, , vol. 25(3), pages 252-275, July.
    5. Michael Devaney & William Weber, 2002. "Small-Business Lending and Profit Efficiency in Commercial Banking," Journal of Financial Services Research, Springer;Western Finance Association, vol. 22(3), pages 225-246, December.

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    Keywords

    Small business; Bank loans;

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