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The role of culture in firm-bank matching
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Accetturo, Antonio, Barboni, Giorgia, Cascarano, Michele and Garcia-Appendini, Emilia (2023) The role of culture in firm-bank matching. Journal of Financial Intermediation, 53 . 101018. doi:10.1016/j.jfi.2023.101018 ISSN 1042-9573.
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Official URL: https://doi.org/10.1016/j.jfi.2023.101018
Abstract
We assemble a unique dataset containing population-level information on loan applications in a region hosting two cultural groups to study the role of culture in firm borrowing decisions. We find that firms are more likely to apply for loans from culturally close banks. This effect is stronger for opaque firms, but not for less performing firms, indicating that firms do not expect preferential treatment from same-culture banks. Loan applications to culturally distant banks increase sharply with firms’ size and age, suggesting a role of information asymmetry in firm-bank matching. In contrast, we find no effect of cultural proximity on loan supply. Overall, our results show that demand-side factors play a key role in the formation of same-culture lending relationships.
Item Type: | Journal Article | ||||||
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Subjects: | H Social Sciences > HF Commerce H Social Sciences > HG Finance |
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Divisions: | Faculty of Social Sciences > Warwick Business School | ||||||
SWORD Depositor: | Library Publications Router | ||||||
Library of Congress Subject Headings (LCSH): | Banks and banking, Corporations -- Finance, Bank loans, Information asymmetry, Business enterprises -- Finance | ||||||
Journal or Publication Title: | Journal of Financial Intermediation | ||||||
Publisher: | Elsevier | ||||||
ISSN: | 1042-9573 | ||||||
Official Date: | 21 January 2023 | ||||||
Dates: |
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Volume: | 53 | ||||||
Number of Pages: | 13 | ||||||
Article Number: | 101018 | ||||||
DOI: | 10.1016/j.jfi.2023.101018 | ||||||
Status: | Peer Reviewed | ||||||
Publication Status: | Published | ||||||
Access rights to Published version: | Open Access (Creative Commons) | ||||||
Date of first compliant deposit: | 29 March 2023 | ||||||
Date of first compliant Open Access: | 29 March 2023 | ||||||
RIOXX Funder/Project Grant: |
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