Arbeitspapier
SMEs and access to bank credit: Evidence on the regional propagation of the financial crisis in the UK
We study the sensitivity of banks' credit supply to small and medium size enterprises (SMEs) in the UK to banks' financial condition before and during the financial crisis. Employing unique data on the geographical location of all bank branches in the UK, we connect firms' access to bank credit to the financial condition (i.e., bank health and the use of core deposits) of all bank branches in the vicinity of the firm over the period 2004-2011. Before the crisis, banks' local financial conditions did not influence credit availability irrespective of the functional distance (i.e., the distance between bank branch and bank headquarters). However, during the crisis, we find that SMEs with in their vicinity banks that have stronger financial condition face greater credit availability when the functional distance is low. Our results point to a "flight to headquarters" effect during the financial crisis.
- Language
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Englisch
- Bibliographic citation
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Series: Cardiff Economics Working Papers ; No. E2015/5
- Classification
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Wirtschaft
Banks; Depository Institutions; Micro Finance Institutions; Mortgages
Financial Institutions and Services: Other
Transactional Relationships; Contracts and Reputation; Networks
- Subject
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financial crisis
credit supply
flight to headquarters
flight to quality
bank organization
- Event
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Geistige Schöpfung
- (who)
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Degryse, Hans
Matthews, Kent
Zhao, Tianshu
- Event
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Veröffentlichung
- (who)
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Cardiff University, Cardiff Business School
- (where)
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Cardiff
- (when)
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2015
- Handle
- Last update
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10.03.2025, 11:42 AM CET
Data provider
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Degryse, Hans
- Matthews, Kent
- Zhao, Tianshu
- Cardiff University, Cardiff Business School
Time of origin
- 2015
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Financing of the SMEs in the European Union Through Credit Institutions
Credit chains and the propagation of financial distress
Japanese SMEs and the credit guarantee system after the global financial crisis
The employment consequences of SMEs' credit constraints in the wake of the great recession
The employment consequences of SMEs' credit constraints in the wake of the Great Recession
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