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Communication Dans Un Congrès Année : 2015

Financial institution network and the certification value of bank loans

Résumé

Social networks and reputation are believed to play important roles in mitigating informational frictions related to financial intermediation, in particular bank lending. We investigate the effect of the network and reputation of financial institutions on the certification value of bank loans using data on syndicated loans to European companies. We find that the presence of more central and reputable leaders in a syndicate substantially increases the stock market's reaction to loan announcements. This certification value is reinforced when informational frictions are more important, but vanishes in case of severe disruptions in the functioning of financial markets, such as during the financial crisis of 2008.
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Dates et versions

hal-01273226 , version 1 (12-02-2016)

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  • HAL Id : hal-01273226 , version 1

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Christophe J. Godlewski, Bulat Sanditov. Financial institution network and the certification value of bank loans. AFFI 2015 : 32nd International Conference of the French Finance Association, Jun 2015, Cergy, France. ⟨hal-01273226⟩
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