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What Makes Firms Dissatisfied with Their Bank Loans: New Evidence from Survey Data

Author

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  • Atanas Kolev

    (European Investment Bank (EIB))

  • Laurent Maurin

    (European Investment Bank (EIB))

  • Matthieu Segol

    (Paris School of Economics)

Abstract

We use loan-by-loan association between non-financial firms and their banks to disentangle the effects of financial weakness of borrowers and lenders on the satisfaction with the loan contracted. We construct indices measuring the financial weakness of borrowers and lenders. We find evidence of both demand and supply factors determining firm satisfaction with bank loan financing, especially regarding cost and collateral requirement. We also find that the impact of supply factors differs across regions within the EU: it is significant in periphery and cohesion countries but not in core countries where access to market is easier.

Suggested Citation

  • Atanas Kolev & Laurent Maurin & Matthieu Segol, 2022. "What Makes Firms Dissatisfied with Their Bank Loans: New Evidence from Survey Data," Journal of Financial Services Research, Springer;Western Finance Association, vol. 61(3), pages 407-430, June.
    • Handle: RePEc:kap:jfsres:v:61:y:2022:i:3:d:10.1007_s10693-021-00362-z
    DOI: 10.1007/s10693-021-00362-z
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    More about this item

    Keywords

    Financial constraints; Bank lending; Survey data; Indices; Cross-section linear models; Bank-firm matching; Satisfaction with bank loans; Bank weakness; EU regions;
    All these keywords.

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • G01 - Financial Economics - - General - - - Financial Crises
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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