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Empirical analysis of corporate credit lines

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  • Gabriel Jiménez

    ()
    (Banco de España)

  • José A. López

    ()
    (Federal Reseve Bank of San Francisco)

  • Jesús Saurina

    ()
    (Banco de España)

Abstract

Since bank credit lines are a major source of corporate funding, we examine the determinants of credit line usage with a comprehensive database of Spanish corporate credit lines. A line’s default status is a key factor driving its usage, which increases as a firm’s financial condition worsens. Line usage decreases by roughly 10% for each year of its life. Lender characteristics, such as the number and length of a firm’s banking relationships, are found to affect a firm’s usage decisions, and credit line usage is found to be inversely related to macroeconomic conditions.

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File URL: http://www.bde.es/f/webbde/SES/Secciones/Publicaciones/PublicacionesSeriadas/DocumentosTrabajo/08/Fic/dt0821e.pdf
File Function: First version, October 2008
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Bibliographic Info

Paper provided by Banco de Espa�a in its series Banco de Espa�a Working Papers with number 0821.

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Length: 35 pages
Date of creation: Oct 2008
Date of revision:
Handle: RePEc:bde:wpaper:0821

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Keywords: credit lines; firm default; bank lending; exposure at default;

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