Banking crises and the lending channel: Evidence from industrial firms in developing countries

Fernández, Ana Isabel; González, Francisco; Suárez, Nuria; Santamaría, Marcos

doi:10.1080/02102412.2013.10779743

Cited by 1 publication

(5 citation statements)

References 36 publications

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“…These results do not allow the confirmation of H2. Similar to the result obtained by this study, Fernández et al (2013) identify a reduction in the maturity of corporate debt in general in post-financial crisis periods, not specifically analyzing the issue of corporate banking dependence. The study by González (2015) identifies that the reduction of debt maturity occurs only for companies that had greater dependence on banks before the financial crisis.…”

Section: Analysis Of Resultssupporting

confidence: 87%

“…Table 6, shows that both governmental and non-governmental agencies reduce their supply of long-term resources to the companies. The reduction of longterm debt, after the crisis, for companies in general, is verified in the study by Fernández et al (2013). However, González (2015) notes this occurs in an increase in the volume of short-term bank debt, but only for companies that have greater dependence on banks before the financial crisis.…”

Section: Resultsmentioning

confidence: 73%

“…However, when considering the relationship between long-term debt and total debt, this percentage increases to 59.3%. The analysis of the subsample of firms with high banking dependence points to an increase (reduction) of long (short) term debt, after the financial crisis, contrary to the behavior presented by companies from developed countries (Fernández et al, 2013;González, 2015). The only country that presents a reduction (increase) of the long (short) term debt is Mexico.…”

Section: Analysis Of Resultsmentioning

confidence: 76%

“…In the study by Orman and Köksal (2017), they do not identify changes in the maturity of the debts of Turkish companies during the financial crisis of 2008. However, Fernández et al (2013) see a reduction in the maturity of debts of several countries in the context of the global financial crisis. Informational asymmetry is greater in long-term debt than in short-term debt.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Kirch and Terra (2012) corroborate this argument by identifying how the institutional quality and financial development of markets contribute to the lengthening of maturity of debts. Fernández et al (2013,; highlight the increase in informational asymmetry between banks and clients during a financial crisis. Banks that have liquidity problems, lower quality or greater risk of their assets, have to be replaced by other sources of credit.…”

Section: Introductionmentioning

confidence: 98%

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Financial Crisis Effect on Latin American Companies’ Debts

Michele¹,

Fishlow²

2020

ERSJ

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Purpose: This study aims to verify changes in the debt structure of companies in the main Latin American countries. Approach/Methodology/Design: A difference-indifferences test is applied in a sample of 520 publicly-traded and closed companies, whose data are collected in the previous (2003-2007) and subsequent (2008-2012) periods of the crisis. Findings: The results include the replacement of bank debts by private and public non-bank debts, reduction of maturity of debts and relevance of better level of governance or regulatory environment of countries in guaranteeing the rights of creditors in this process. Practical Implications: These results are in line with the countercyclical fiscal policy adopted by these countries, guaranteeing them greater credibility in international markets. Social Implications: This study also suggest questions for future research. Each Latin American country faces many problems that are motivated by diverse events-political, for example-that impact the economy. That task involves the broadening of this methodology to incorporate internal shocks as well as global crisis. Originality/Value: One of the principal contributions of this study is the finding that companies in the main Latin American countries replace their banking credit by utilizing non-banks, just as done by the developed countries. Understanding better this effect of the global financial crisis may lead to helpful permanent macroeconomic and microeconomic measures.

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