Empirical Analysis of Corporate Credit Lines

Posted: 24 Nov 2009

See all articles by Gabriel Jiménez

Gabriel Jiménez

Banco de España

Jose A. Lopez

Federal Reserve Bank of San Francisco

Jesús Saurina

Bank of Spain

Multiple version iconThere are 3 versions of this paper

Date Written: December 2009

Abstract

Since bank credit lines are a major source of corporate funding, we examine the determinants of their usage with a comprehensive database of Spanish corporate credit lines. A line's default status is a key factor driving its usage, which increases as firm financial conditions worsen. Firms with prior defaults access their credit lines less, suggesting that bank monitoring influences firms’ usage decisions. Line usage has an aging effect that causes it to decrease by roughly 10% per year of its life. Lender characteristics, such as the length of a firm's banking relationships, as well as macroeconomic conditions, affect usage decisions.

Keywords: E32, G18, M21

Suggested Citation

Jimenez, Gabriel and Lopez, Jose Antonio and Saurina, Jesús, Empirical Analysis of Corporate Credit Lines (December 2009). The Review of Financial Studies, Vol. 22, Issue 12, pp. 5069-5098, 2009. Available at SSRN: https://ssrn.com/abstract=1509900 or http://dx.doi.org/hhp061

Gabriel Jimenez (Contact Author)

Banco de España ( email )

Alcala 50
Madrid 28014
Spain

Jose Antonio Lopez

Federal Reserve Bank of San Francisco ( email )

101 Market Street
San Francisco, CA 94105
United States
415-977-3894 (Phone)
415-974-2168 (Fax)

Jesús Saurina

Bank of Spain

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