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Multiple banking relationships: do SMEs mistrust their banks?

Author

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  • Catherine Refait-Alexandre

    (CRESE - Centre de REcherches sur les Stratégies Economiques (UR 3190) - UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE])

  • Stéphanie Serve

    (IRG - Institut de Recherche en Gestion - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12)

Abstract

This paper focuses on the determinants of the use of multiple banking relationships by SMEs. We exploit the results of an original survey conducted on a sample of French SMEs in December 2012. We first provide evidence that access to multiple banking relationships is influenced by firms' characteristics. We find that larger, high-performing and innovative firms are more likely to develop multiple banking relationships. More originally, relying on the management literature, we also highlight the explanatory power of trust from the perspective of the CEO: when the CEO mistrusts the firm's main bank, the firm will be more likely to engage in multiple banking relationships.

Suggested Citation

  • Catherine Refait-Alexandre & Stéphanie Serve, 2020. "Multiple banking relationships: do SMEs mistrust their banks?," Post-Print hal-03141969, HAL.
    • Handle: RePEc:hal:journl:hal-03141969
    DOI: 10.1016/j.ribaf.2018.04.005
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    3. D’Apolito, Elisabetta & Galletta, Simona & Iannuzzi, Antonia Patrizia & Labini, Stefania Sylos, 2024. "Sustainability and bank credit access: New evidence from Italian SMEs," Research in International Business and Finance, Elsevier, vol. 69(C).

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    More about this item

    Keywords

    Banking relationships; Small business; Credit rationing; Trust;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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