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Do Ex-Bankers Benefit Nonfinancial Firms? Evidence from Job Transitions
[Loan prospecting and the loss of soft information]

Author

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  • Lucy Chernykh
  • Sergey Mityakov

Abstract

We document the beneficial impact of human capital transfer from banks to nonfinancial firms: firms hiring ex-bankers have higher asset and employment growth and easier access to bank loans. Using a unique employee-employer-matched data set from Russia and exogenous variation in ex-bankers’ supply due to bank-branch-network restructurings, we establish the causal interpretation of these patterns. We also show that ex-bankers’ human capital consists of bank-specific and banking industry expertise (with the latter being acquired through interbank connections). Firms recognize the value of ex-bankers, who receive significant salary bonuses when a new bank loan is issued to the firm (JEL G21, G32, J24).Received August 17, 2020; editorial decision January 5, 2022; by editor: Isil Erel. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

Suggested Citation

  • Lucy Chernykh & Sergey Mityakov, 2022. "Do Ex-Bankers Benefit Nonfinancial Firms? Evidence from Job Transitions [Loan prospecting and the loss of soft information]," The Review of Corporate Finance Studies, Society for Financial Studies, vol. 11(2), pages 364-413.
    • Handle: RePEc:oup:rcorpf:v:11:y:2022:i:2:p:364-413.
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    More about this item

    JEL classification:

    • 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
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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