Credit Rationing, Customer Relationship and the Number of Banks: An Empirical Analysis

9 Pages Posted: 28 Mar 2005

See all articles by Eric de Bodt

Eric de Bodt

Univ. Lille

Frederic Lobez

University of Lille II - GERME Research Center

Jean-Christophe Statnik

University of Lille II - University of Lille LSMRC & ISA

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Abstract

The recent important transformations of the banking sector, especially through numerous mergers and acquisitions, both in Europe and in the USA, have raised serious concerns for the financing of small businesses (SBS). Indeed, SBS are known to be heavily dependent of this financing channel but to be rather opaque. It has long been thought that banks classically solved this problem by developing long term customer relationships. But will the new large banks, born from the current restructuring process, be able to continue to play this role? If not, what strategy should SBS develop to compose their bank pool in order to avoid, as much as possible, credit rationing? These questions are at the heart of our analysis. We show that there is no unique rule: all depends on the degree of SBS opacity and the kind of bank the SBS are working with.

Suggested Citation

de Bodt, Eric and Lobez, Frederic and Statnik, Jean-Christophe, Credit Rationing, Customer Relationship and the Number of Banks: An Empirical Analysis. European Financial Management, Vol. 11, No. 2, pp. 195-228, March 2005. Available at SSRN: https://ssrn.com/abstract=688649

Eric De Bodt (Contact Author)

Univ. Lille ( email )

1 place Déliot, BP381
59020 Lille Cedex
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+03 20 90 74 77 (Phone)
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HOME PAGE: http://www.edebodt.net

Frederic Lobez

University of Lille II - GERME Research Center ( email )

1, Place Deliote BP 381
Lille, 59000
France
03 20 99 74 75 (Phone)
03-20-90-77-02 (Fax)

Jean-Christophe Statnik

University of Lille II - University of Lille LSMRC & ISA ( email )

1, rue de Mulhouse
Lille, 59000
France

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