Revised Syndicated Lending Paper April 2014.pdf (236.51 kB)
Determinants of syndicated lending in European banks and the impact of the financial crisis
journal contributionposted on 2014-09-15, 13:37 authored by Barry Howcroft, Alper Kara, David Marques-Ibanez
Syndicated lending is a widely practiced alternative to traditional bilateral lending and within Europe the syndicated loan market increased significantly during the 2000s. Using a dataset consisting of 4,166 European banks, the authors examine the factors that determine the bank’s willingness to use syndicated lending rather than traditional lending during the period 2000 to 2010. The paper finds that syndicated lending was an alternative to bilateral loans when banks were targeting growth or looking to utilise potential capital surpluses. Syndicated lending was also used to improve the returns and credit quality of the bank’s loan portfolios. However, in the post crisis period, European banks are less interested in syndicated loan markets and larger banks, especially, those with strong capital bases, are refraining from syndicated lending.
This work was supported by the Nuffield Foundation [grant number J12059].
- Business and Economics
Published inJournal of International Financial Markets, Institutions and Money
Pages473 - 490 (18)
CitationHOWCROFT, B., KARA, A. and MARQUES-IBANEZ, D., 2014. Determinants of syndicated lending in European banks and the impact of the financial crisis. Journal of International Financial Markets, Institutions and Money, 32, pp.473-490.
- AM (Accepted Manuscript)
Publisher statementThis work is made available according to the conditions of the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0) licence. Full details of this licence are available at: https://creativecommons.org/licenses/by-nc-nd/4.0/
NotesThis is the author’s version of a work that was accepted for publication in Journal of International Financial Markets, Institutions and Money. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published at: http://dx.doi.org/10.1016/j.intfin.2014.07.005