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
Citation
CHOI, Seungho; GAM, Yong Kyu; PARK, Junho; and SHIN, Hojong.
Bank partnership and liquidity crisis. (2020). Journal of Banking and Finance. 120, 1-15.
Available at: https://ink.library.smu.edu.sg/lkcsb_research/6699
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1016/j.jbankfin.2020.105958