Does the 'Foreignness' of Bank Loans Matter? Evidence from a New Dataset

36 Pages Posted: 3 Dec 2018

See all articles by Jens Forssbæck

Jens Forssbæck

Lund University - Department of Economics

Frederik Lundtofte

Lund University - Department of Economics

Martin Strieborny

Lund University

Anders Vilhelmsson

Lund University - Department of Economics

Date Written: November 15, 2018

Abstract

We analyze the heterogeneity of foreign bank loans in a newly constructed global dataset that explicitly distinguishes in a disaggregated loan-bank-firm setting between domestic loans and three categories of foreign loans: loans by subsidiaries of foreign banks, loans by foreign bank branches, and direct cross-border loans. We find that borrower characteristics and loan conditions often significantly differ across different foreign loan categories, with loans by foreign bank subsidiaries in many respects resembling domestic loans rather than other foreign loan categories. We also find pronounced non-monotonicities in loan conditions and borrower characteristics when moving from "less foreign" to "more foreign" bank loans.

Keywords: cross-border lending, syndicated loans

JEL Classification: G21, G32, F65

Suggested Citation

Forssbaeck, Jens and Lundtofte, Frederik and Strieborny, Martin and Vilhelmsson, Anders, Does the 'Foreignness' of Bank Loans Matter? Evidence from a New Dataset (November 15, 2018). Available at SSRN: https://ssrn.com/abstract=3285393 or http://dx.doi.org/10.2139/ssrn.3285393

Jens Forssbaeck

Lund University - Department of Economics ( email )

P.O. Box 7082
S-220 07 Lund
Sweden

Frederik Lundtofte

Lund University - Department of Economics ( email )

P.O. Box 7082
Lund
Sweden
+46 46 222 4970 (Phone)
+46 46 222 4118 (Fax)

HOME PAGE: http://www.nek.lu.se/nekflu

Martin Strieborny (Contact Author)

Lund University ( email )

P.O. Box 7082
S-220 07 Lund
Sweden

Anders Vilhelmsson

Lund University - Department of Economics ( email )

Lund
Sweden

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