Joint Size and Ownership Specialization in Bank Lending

43 Pages Posted: 2 Mar 2006

See all articles by Jesus Saurina Salas

Jesus Saurina Salas

Banco de España

Javier Delgado

Banco de España

Vicente Salas-Fumás

University of Zaragoza - Department of Business Administration and Organization

Date Written: February 2006

Abstract

In this paper we study the specialization of Spanish banks along two interwoven dimensions: size and form of ownership. We find some interesting results at odds with the existing empirical literature. As commercial banks increase their size, they lend more to large borrowers but that is not the case for the largest banks. For savings banks, the larger the size, the more likely they are to lend to small borrowers. Moreover, we find evidence that larger commercial banks are more willing to lend to low credit quality borrowers than medium size banks, while the opposite is true among savings banks. Banks' specialization in lending to business firms seems to go across the reputation considerations, risk shifting behavior and lending technologies most often considered in the literature.

Keywords: bank specialization, transactional lending, relational lending, ownership form

JEL Classification: D23, G21

Suggested Citation

Saurina Salas, Jesus and Delgado, Javier and Salas-Fumás, Vicente, Joint Size and Ownership Specialization in Bank Lending (February 2006). Available at SSRN: https://ssrn.com/abstract=887095 or http://dx.doi.org/10.2139/ssrn.887095

Jesus Saurina Salas (Contact Author)

Banco de España ( email )

Madrid 28014
Spain

Javier Delgado

Banco de España ( email )

Madrid 28014
Spain

Vicente Salas-Fumás

University of Zaragoza - Department of Business Administration and Organization ( email )

Dr. Cerrada 1
5005 Zaragoza
Spain
+34 976 761803 (Phone)

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