Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/144391
Authors: 
Degryse, Hans
Masschelein, Nancy
Mitchell, Janet
Year of Publication: 
2009
Series/Report no.: 
Working Paper Research 179
Abstract: 
Assessing the impacts of bank mergers on small firms requires separating borrowers with single versus multiple banking relationships and distinguishing the three alternatives of "staying," "dropping," and "switching" of relationship. Single-relationship borrowers who "switch" to another bank following a merger will be less harmed than those whose relationship is "dropped" and not replaced. Using Belgian data, we find that single-relationship borrowers of target banks are more likely than other borrowers to be dropped. We track post-merger performance and show that many dropped target-bank borrowers are harmed by the merger. Multiple-relationship borrowers are less harmed, as they can better hedge against relationship discontinuations
Subjects: 
Bank mergers
bank lending relationships
SME loans
JEL: 
G21
G28
G34
Document Type: 
Working Paper

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