Duration of Syndication Process and Syndicate Organization

37 Pages Posted: 16 Feb 2009

See all articles by Christophe J. Godlewski

Christophe J. Godlewski

University of Strasbourg - Faculty of Law and Business; EM Strasbourg Business School; LaRGE Research Center

Multiple version iconThere are 2 versions of this paper

Date Written: December 2008

Abstract

What influence does syndicate organization have on the duration of the loan syndication process? We answer this question using survival analysis methodology on a sample of more than 4,800 loans to borrowers from 59 countries. We find that syndicate size, concentration, experience, reputation, and national diversity clearly matter for the duration of the syndication process and therefore for borrower satisfaction in terms of the speed of obtaining the necessary funding. A syndicate organization adapted to the specific agency problems of syndication, with numerous, reputable and experienced arrangers holding a larger portion of the loan reduces the duration. The latter is also shorter when more lenders come from the same country as the borrower. These effects are more pronounced when the borrower has a low reputation on the syndicated lending market or is more opaque.

Keywords: Syndicated loan, syndication process, syndicate organization, agency costs, experience, reputation, nationality, survival analysis

JEL Classification: F30, G15, G21, G32, C41

Suggested Citation

Godlewski, Christophe J., Duration of Syndication Process and Syndicate Organization (December 2008). Available at SSRN: https://ssrn.com/abstract=1342389 or http://dx.doi.org/10.2139/ssrn.1342389

Christophe J. Godlewski (Contact Author)

University of Strasbourg - Faculty of Law and Business ( email )

1 place d'Athènes
Strasbourg, 67000
France

HOME PAGE: http://droit.unistra.fr/

EM Strasbourg Business School ( email )

61 Avenue de la Forêt Noire
Strasbourg, 67000
France

HOME PAGE: http://www.em-strasbourg.eu/

LaRGE Research Center ( email )

1 place d'Athènes
Strasbourg, 67000
France

HOME PAGE: http://droit.unistra.fr/

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