The Effect of Relationship Lending on the Contract terms of the Loans

Please enable javascript in your browser.

Foroughi Fard, Rasoul | 2017

657 Viewed

Type of Document: M.Sc. Thesis
Language: Farsi
Document No: 49296 (44)
University: Sharif University of Technology
Department: Management and Economics
Advisor(s): Rahmati, Mohammad Hossein
Abstract:
This study examin the effect of relationship lending on the contract terms of the loans consist of loan rate, avalibility of the loan and collateral reqierements. For this purpose, we use 4850 data of loan granted by GHavamin bank in three months Farvardin, Ordibehesht and KHordad in 1395. The results of this study indicate relationship lending has a negative significant effect on the loan rate, a positive significant effect on the availability of the loan and positive insignificant effect on the collateral requirements. Thus, relationship lending as a solution for information asymmetry, leading to cost advantage for the banks. Banks transfer this advantage to client by lowering the loan rate and increasing the availability of the loans.
Keywords:
Asymmetric Information ; Coupon Rate ; Bank-lending Channel ; Relationship Lending ; Loan Consist ; Collateral Requirement

No TOC