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Models of Bank Financing of Czech Corporations and Credit Risk

In: CNB Financial Stability Report 2008/2009


  • Adam Gersl
  • Petr Jakubik


This article presents the results of an analysis of data on individual bank loans of non-financial corporations in the Czech Republic taken from the CNB’s Central Register of Credits. It focuses on the question of how firms obtain financing from domestic banks. The results show that the vast majority of non-financial corporations use the services of just one relationship lender. Small and young firms in technology- and knowledge-intensive industries tend to concentrate their credit needs in a single bank, whereas less creditworthy firms and firms in cyclical industries tend to borrow from more than one bank. It also turns out that the level of credit risk at bank level decreases in line with the extent to which firms applying single relationship banking occur in the bank’s portfolio.

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  • Adam Gersl & Petr Jakubik, 2009. "Models of Bank Financing of Czech Corporations and Credit Risk," Occasional Publications - Chapters in Edited Volumes,in: CNB Financial Stability Report 2008/2009, chapter 0, pages 92-101 Czech National Bank, Research Department.
  • Handle: RePEc:cnb:ocpubc:fsr0809/3

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    References listed on IDEAS

    1. Bolton, Patrick & Scharfstein, David S, 1996. "Optimal Debt Structure and the Number of Creditors," Journal of Political Economy, University of Chicago Press, vol. 104(1), pages 1-25, February.
    2. Elsas, Ralf, 2005. "Empirical determinants of relationship lending," Journal of Financial Intermediation, Elsevier, vol. 14(1), pages 32-57, January.
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    Cited by:

    1. Horváth, Roman & Podpiera, Anca, 2012. "Heterogeneity in bank pricing policies: The Czech evidence," Economic Systems, Elsevier, vol. 36(1), pages 87-108.
    2. Lucie Reznakova & Svatopluk Kapounek, 2014. "Is There a Credit Crunch in the Czech Republic?," MENDELU Working Papers in Business and Economics 2014-50, Mendel University in Brno, Faculty of Business and Economics.

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