Global Syndicated Lending during the COVID-19 Pandemic

82 Pages Posted: 15 Oct 2020 Last revised: 1 Jul 2021

See all articles by Iftekhar Hasan

Iftekhar Hasan

Fordham University ; Bank of Finland; University of Sydney

Panagiotis N. Politsidis

The University of Sydney

Zenu Sharma

St John's University; Rensselaer Polytechnic Institute

Date Written: March 13, 2021


This paper examines the pricing of global syndicated loans during the COVID-19 pandemic. We find that loan spreads rise by over 11 basis points in response to a one standard deviation increase the lender’s exposure to COVID-19 and over 5 basis points for an equivalent increase in the borrower’s exposure. This renders firms subject to a burden of about USD 5.16 million and USD 2.37 million respectively in additional interest expense for a loan of average size and duration. The aggravating effect of the pandemic is exacerbated with the level of government restrictions to tackle the virus’s spread, with firms’ financial constraints and reliance on debt financing, whereas it is mitigated for relationship borrowers, borrowers listed in multiple exchanges or headquartered in countries that can attract institutional investors.

Keywords: Syndicated loans, Cost of credit, COVID-19, Pandemic

JEL Classification: G01, G21, G29, G3

Suggested Citation

Hasan, Iftekhar and Politsidis, Panagiotis N. and Sharma, Zenu, Global Syndicated Lending during the COVID-19 Pandemic (March 13, 2021). Journal of Banking and Finance, Forthcoming, Available at SSRN: or

Iftekhar Hasan

Fordham University ( email )

NEW YORK, NY 10023
United States

Bank of Finland ( email )

P.O. Box 160
Helsinki 00101

University of Sydney ( email )

P.O. Box H58
Sydney, NSW 2006

Panagiotis N. Politsidis (Contact Author)

The University of Sydney ( email )

Rm 540, H-69 Codrington Building
The University of Sydney
Sydney, NSW 2006

Zenu Sharma

St John's University ( email )

8000 Utopia Pkwy
Queens, NY 11439
United States
7189905496 (Phone)

Rensselaer Polytechnic Institute ( email )

Troy, NY 12180
United States

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