Publication Type

Journal Article

Version

acceptedVersion

Publication Date

11-2020

Abstract

This study empirically investigates the relationship between banking integration and liquidity management. To measure banks’ connectivity, we use the number of partnerships proxied via the syndicated loan arrangements in which they serve as lead arrangers. If banks establish more business partnerships through syndicated loan arrangements, those under market stress are more likely to face increased funding costs, create reduced liquidity, and originate declined small business loans and mortgages. Those banks with more partners are shown to have a lower liquidity coverage ratio, suggesting that business partnerships create a disincentive toward liquidity risk management.

Keywords

Bank, Financial crisis, Network, Partnership

Discipline

Finance and Financial Management

Publication

Journal of Banking and Finance

Volume

120

First Page

1

Last Page

15

ISSN

0378-4266

Identifier

10.1016/j.jbankfin.2020.105958

Publisher

Elsevier

Embargo Period

5-13-2021

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.1016/j.jbankfin.2020.105958

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