UM  > 工商管理學院
Asymmetric information and price competition in small business lending
Ming-Hua Liu1,3; Dimitris Margaritis2; Alireza Tourani-Rad3
2011-02-02
Source PublicationJournal of Banking & Finance
ISSN0378-4266
Volume35Issue:9Pages:2189-2196
Abstract

This paper examines the relationship between bank lending rates and their cost of funds in New Zealand. Our results show that on average mortgage rates respond more quickly to changes in the cost of funds than base business lending rates. We also find an asymmetry in the initial (short-run) response of banks to changes in funding costs; in particular, our results show banks adjust mortgage rates downwards faster than upwards. The speed to which lending rates revert back to their equilibrium relationship with funding costs varies across the lending markets. We find the adjustment speed is faster when mortgage rates are below equilibrium, whereas it is slower when business lending rates are above long-run levels in relation to funding costs. Our analysis suggests that banks prefer the plain-vanilla type of lending such as mortgages in comparison to small business lending consistent with asymmetric information associated with business loans.

KeywordLending Rate Small And Medium Enterprises Information Asymmetry Error-correction Models Cost Of Funds
DOI10.1016/j.jbankfin.2011.01.022
Indexed BySCI
Language英语
WOS Research AreaBusiness & Economics
WOS SubjectBusiness, Finance ; Economics
WOS IDWOS:000293310700001
Fulltext Access
Citation statistics
Cited Times [WOS]:10   [WOS Record]     [Related Records in WOS]
Document TypeJournal article
CollectionFaculty of Business Administration
DEPARTMENT OF FINANCE AND BUSINESS ECONOMICS
Corresponding AuthorDimitris Margaritis
Affiliation1.Faculty of Business Administration, University of Macau, Macau, China
2.The University of Auckland Business School, Auckland, New Zealand
3.Faculty of Business & Law, Auckland University of Technology, New Zealand
First Author AffilicationFaculty of Business Administration
Recommended Citation
GB/T 7714
Ming-Hua Liu,Dimitris Margaritis,Alireza Tourani-Rad. Asymmetric information and price competition in small business lending[J]. Journal of Banking & Finance,2011,35(9):2189-2196.
APA Ming-Hua Liu,Dimitris Margaritis,&Alireza Tourani-Rad.(2011).Asymmetric information and price competition in small business lending.Journal of Banking & Finance,35(9),2189-2196.
MLA Ming-Hua Liu,et al."Asymmetric information and price competition in small business lending".Journal of Banking & Finance 35.9(2011):2189-2196.
Related Services
Recommend this item
Bookmark
Usage statistics
Export to Endnote
Google Scholar
Similar articles in Google Scholar
[Ming-Hua Liu]'s Articles
[Dimitris Margaritis]'s Articles
[Alireza Tourani-Rad]'s Articles
Baidu academic
Similar articles in Baidu academic
[Ming-Hua Liu]'s Articles
[Dimitris Margaritis]'s Articles
[Alireza Tourani-Rad]'s Articles
Bing Scholar
Similar articles in Bing Scholar
[Ming-Hua Liu]'s Articles
[Dimitris Margaritis]'s Articles
[Alireza Tourani-Rad]'s Articles
Terms of Use
No data!
Social Bookmark/Share
All comments (0)
No comment.
 

Items in the repository are protected by copyright, with all rights reserved, unless otherwise indicated.