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A Peer-reviewed scientific articles/A1 Journal article (refereed), original research
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What drives discretion in bank lending? Some evidence and a link to private information, Journal of Banking and Finance September (2019). Ambrocio, Gene; Hasan, Iftekhar

Category A Peer-reviewed scientific articles
Sub-category A1 Journal article (refereed), original research
auki Internal authors
All authors as text Ambrocio, Gene; Hasan, Iftekhar 
Number of authors
Status Published
Year of publication 2019 
Date 11.07.2019 
Name of article What drives discretion in bank lending? Some evidence and a link to private information 
Name of journal Journal of Banking and Finance
Volume of issue 106 
Number of issue September 
Pages 323-340 
Abstract We assess the extent to which discretion, unexplained variations in the terms of a loan contract, has varied across time and lending institutions and show that part of this discretion is due to private information that lenders have on their borrowers. We find that discretion is lower for secured loans and loans granted by a larger group of lenders, and is larger when the lenders are larger and more profitable. Over time, discretion is also lower around recessions although the private information content is higher. The results suggest that bank discretionary and private information acquisition behavior may be important features of the credit cycle.
Free text descriptor in Finnish pankit; luotot; informaatio; luotonanto; 
Free text descriptor in English Bank discretion; Credit screening; Private information; syndicated loans 
JEL-codes D82; G14; G21; G28 
ISSN / e-ISSN 0378-4266 
auki Internet addresses
Additional information Available online 11 July 2019
Notes BoF DP 17/2018 
Open Access Not known

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