Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/200087 
Year of Publication: 
2018
Citation: 
[Journal:] Journal of International Money and Finance [ISSN:] 0261-5606 [Volume:] 80 [Publisher:] Elsevier [Place:] Amsterdam [Year:] 2018 [Pages:] 35-58
Publisher: 
Elsevier, Amsterdam
Abstract: 
This paper investigates how the withdrawal of banks from their cross-border business impacted the borrowing costs of European firms since the crisis. We combine aggregate information on total and cross-border credit with firm-level survey data for the period 2010–2014. We find that the decline in cross-border lending led to a deterioration in the borrowing conditions of small firms. In countries with more pronounced reductions in cross-border credit inflows, the likelihood of a rise in firms’ external financing costs increased. This result is mainly driven by the interbank channel, which plays a crucial role in transmitting shocks to the real sector across borders.
Subjects: 
International banking
Credit constraints
Firm finance
JEL: 
F34
F36
G15
G21
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

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