Switching from Single to Multiple Bank Lending Relationships: Determinants and Implications☆

By Luísa Farinha, João A. C. Santos. 2002

419 citations recorded by the source corpus.

View Paper: https://www.semanticscholar.org/paper/29f941d3b970373ce4fa04c51855ca369e28c81b

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Citations in the corpus

Bank Loans, Bonds, and Information Monopolies Across the Business Cycle (2008, positive): “Farinha and Santos (2002) examine Portuguese data and find that firms with greater growth opportunities, less liquidity, or greater bank dependence are more likely to switch to multiple bank relationships, all of which is consistent with reducing hold-up problems.”
What Determines the Composition of Banks' Loan Portfolios? Evidence from Transition Countries (2010, neutral): “For instance, Farinha and Santos (2002) show that firms that borrow for the first time use a single bank but soon afterwards initiate relationships with additional banks in order to prevent hold up problems.”
Bank ownership type and banking relationships (2006, positive): “Regarding the second motive, Farinha and Santos (2002) offer support for the notion that multiple”
Distance and Private Information in Lending (2010, background): “18 The decision to switch lenders is very different from a borrower’s choice of single versus multiple banking relationships; see Detragiache, Garella, and Guiso (2000) and Farinha and Santos (2002).”
Empirical determinants of relationship lending (2005, background): “Fischer (1990), Rajan (1992) and Petersen and Rajan (1994).”
Lending relationships in line-of-credit and nonline-of-credit loans: Evidence from collateral use in small business (2006, neutral): “Farinha and Santos (2002)also find poor performers in Portugal are more likely to initiate multiple relationships.”
Why Do Firms Form New Banking Relationships (2011, neutral): “Two related papers that examine the question of why firms borrow from nonrelationship banks are Farinha and Santos (2002) and Ioannidou and Ongena (2006). Using the monthly credit reports filed by Portuguese banks with their central bank, Farinha and Santos (2002) find that firms with more growth op”
The Private Equity Advantage: Leveraged Buyout Firms and Relationship Banking (2011, neutral): “Ongena and Smith (2001), Houston and James (2001), Farinha and Santos (2002) and, more recently, Gopalan, Udell, and Yerramilli (2008) investigate this phenomenon in a non-LBO context.”
Relationship and Transaction Lending in a Crisis (2013, neutral): “The other key 2Our model thus also relates to the rich literature on rms choice of the number of banks they deal with (Houston and James, 1996; Farinha and Santos, 2002; Detragiache, Garella and Guiso, 2000).”
Do Small Businesses Still Prefer Community Banks (2013, background): “Firms may bear additional costs to engage in multiple relationships to mitigate the rent extraction (e.g., Von Thadden 1992, Boot 2000, Farinha and Santos 2002, Elsas, Heinemann, and Tyrell 2004).6 Firms may also bear the duplicative costs of multiple banking instead of a single strong…”
Multiple-bank lending: diversification and free-riding in monitoring (2004, neutral): “…relationships tends to increase with firm size, also small and medium enterprises (SMEs) borrow from more than one bank at some point in their life cycle as reported for countries like the US, Italy and Portugal (Petersen and Rajan, 1994; Detragiache et al., 2000; and Farinha and Santos, 2002).”
The Impact of Bank Consolidation on Commercial Borrower Welfare (2005, neutral): “Similar to Ongena and Smith (2001) and Farinha and Santos (2002), these results suggest that the propensity to terminate is higher for small firms, firms with multiple bank relationships, and firms in relatively long-lived relationships.”
Relationship lending and SME financing in the continental European bank-based system (2010, background): “relationship because SMEs start out working with a single bank and tend to stay with this institution for many years, although they can borrow from other financial intermediaries after the initial years ( Farinha and Santos 2002 ).”