Gender and Banking: Are Women Better Loan Officers?
Tilburg University - European Banking Center, CentER
Braziliann School of Public and Business Administration
University of Ulm - Department of Mathematics and Economics; European Business School (EBS) Wiesbaden - Department of Finance, Accounting & Real Estate
May 31, 2010
Review of Finance, Forthcoming
European Banking Center Discussion Paper No. 2009-19
CentER Discussion Paper Series No. 2009-63
We analyze gender differences associated with loan officer performance. Using a unique data set for a commercial bank over the period 1996 to 2006, we find that loans screened and monitored by female loan officers show a statistically and economically significant lower likelihood to turn problematic than loans handled by male loan officers. This effect comes in addition to a lower risk of female borrowers and cannot be explained by sample selection, experience differences between female and male loan officers, or different workload of male loan officers. Our results seem to be driven by differences in monitoring between female and male loan officers as both are equally good at screening based on observable as well as on unobservable borrower characteristics. This suggests that gender indeed matters in banking.
Number of Pages in PDF File: 51
Keywords: Behavioral banking, loan officers, gender, loan default, monitoring, screening
JEL Classification: G21, J16Accepted Paper Series
Date posted: August 4, 2009 ; Last revised: July 4, 2012
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