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Do Firm-Bank `Odd Couples' Exacerbate Credit Rationing?

Author

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  • Giovanni Ferri

    () (University of Bari)

  • Pierluigi Murro

    () (University of Bari)

  • Zeno Rotondi

    (UniCredit Group's Retail Research Division)

Abstract

We start considering an optimal matching of opaque (transparent) borrowing firrms with relational (transactional) lending main banks. Next we contemplate the possibility that firm-bank "odd couples" materialize where opaque (transparent) firrms end up matched with transactional (re- lational) main banks. We conjecture the "odd couples" emerge either since the bank's lending technology is not perfectly observable to the rm or because riskier firrms - even though opaque - strategically select transac- tional banks in the hope of being classified as lower risks. Our econometric results show the probability of rationing is larger when firrms and banks match in "odd couples".

Suggested Citation

  • Giovanni Ferri & Pierluigi Murro & Zeno Rotondi, 2010. "Do Firm-Bank `Odd Couples' Exacerbate Credit Rationing?," SERIES 0031, Dipartimento di Economia e Finanza - Università degli Studi di Bari "Aldo Moro", revised Jul 2010.
    • Handle: RePEc:bai:series:economia-series31
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    Citations

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    Cited by:

    1. Jeremie Bertrand & Pierluigi Murro, 2018. "Is trade credit a substitute for relationship lending credit?," CERBE Working Papers wpC25, CERBE Center for Relationship Banking and Economics.
    2. repec:eee:reveco:v:60:y:2019:i:c:p:238-256 is not listed on IDEAS
    3. Marco Cucculelli & Valentina Peruzzi & Alberto Zazzaro, 2016. "Relational capital in lending relationships: Evidence from European family firms," CERBE Working Papers wpC12, CERBE Center for Relationship Banking and Economics.
    4. Ferri, Giovanni & Murro, Pierluigi & Peruzzi, Valentina & Rotondi, Zeno, 2019. "Bank lending technologies and credit availability in Europe: What can we learn from the crisis?," Journal of International Money and Finance, Elsevier, vol. 95(C), pages 128-148.
    5. Giovanni Ferri & Pierluigi Murro, 2016. "A Credit Crunch Behind the Great Trade Collapse? Micro Evidence From Europe," CERBE Working Papers wpC10, CERBE Center for Relationship Banking and Economics.
    6. repec:eee:jbfina:v:101:y:2019:i:c:p:173-187 is not listed on IDEAS
    7. Giovanni Ferri & Raoul Minetti & Pierluigi Murro, 2018. "Credit Relationships in the Great Trade Collapse. Micro Evidence From Europe," CERBE Working Papers wpC26, CERBE Center for Relationship Banking and Economics.
    8. Pigini, Claudia & Presbitero, Andrea F. & Zazzaro, Alberto, 2016. "State dependence in access to credit," Journal of Financial Stability, Elsevier, vol. 27(C), pages 17-34.
    9. repec:taf:jbemgt:v:18:y:2017:i:4:p:650-675 is not listed on IDEAS
    10. repec:kap:sbusec:v:52:y:2019:i:1:d:10.1007_s11187-018-0019-3 is not listed on IDEAS
    11. Marco Cucculelli & Valentina Peruzzi & Alberto Zazzaro, 2019. "Relational capital in lending relationships: evidence from European family firms," Small Business Economics, Springer, vol. 52(1), pages 277-301, January.
    12. Andrea Fracasso & Valentina Peruzzi & Chiara Tomasi, 2019. "Multiple banking relationships: the role of firm connectedness," DEM Working Papers 2019/3, Department of Economics and Management.
    13. Cucculelli, Marco & Peruzzi, Valentina, 2017. "Bank screening technologies and the founder effect: Evidence from European lending relationships," Finance Research Letters, Elsevier, vol. 20(C), pages 229-237.
    14. Murro, Pierluigi & Peruzzi, Valentina, 2019. "Family firms and access to credit. Is family ownership beneficial?," Journal of Banking & Finance, Elsevier, vol. 101(C), pages 173-187.
    15. repec:bla:eufman:v:23:y:2017:i:4:p:807-835 is not listed on IDEAS
    16. repec:eee:jbfina:v:100:y:2019:i:c:p:205-217 is not listed on IDEAS
    17. Giovanni Ferri & Pierluigi Murro & Marco Pini, 2018. "Credit Rationing and the Relationship Between Family Businesses and Banks in Italy," CERBE Working Papers wpC24, CERBE Center for Relationship Banking and Economics.

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    Keywords

    Relationship Banking; Credit Rationing and Asymmetric Information;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations

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