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Banking Environment, Agency Costs, and Loan Syndication : A Cross-Country Analysis

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  • Christophe J. Godlewski

    ()
    (Laboratoire de Recherche en Gestion et Economie, Université Louis Pasteur)

Abstract

Bank loan syndicate structure can be considered as an organizational response to agency problems stemming from the syndication process. The banking environment also influences the syndication process. We investigate how syndicate structure is influenced by the characteristics of the banking environment, such as banking market structure, financial development, banking regulation and supervision, and legal risk. The results of a cross-country analysis performed on a sample of 15,586 syndicated loan facilities from 24 countries over a period of 15 years confirm that syndicate structure is influenced by banking environments consistent with agency costs minimization and efficient re-contracting objectives.

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Bibliographic Info

Paper provided by Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg in its series Working Papers of LaRGE Research Center with number 2008-08.

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Date of creation: 2008
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Handle: RePEc:lar:wpaper:2008-08

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Keywords: Banking environment; Agency costs; Loan syndication; Syndicate structure.;

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