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Empirical analysis of corporate credit lines

Author

Listed:
  • Gabriel Jiménez

    (Banco de España)

  • José A. López

    (Federal Reseve Bank of San Francisco)

  • Jesús Saurina

    (Banco de España)

Abstract
Since bank credit lines are a major source of corporate funding, we examine the determinants of credit line usage with a comprehensive database of Spanish corporate credit lines. A line’s default status is a key factor driving its usage, which increases as a firm’s financial condition worsens. Line usage decreases by roughly 10% for each year of its life. Lender characteristics, such as the number and length of a firm’s banking relationships, are found to affect a firm’s usage decisions, and credit line usage is found to be inversely related to macroeconomic conditions.

Suggested Citation

  • Gabriel Jiménez & José A. López & Jesús Saurina, 2008. "Empirical analysis of corporate credit lines," Working Papers 0821, Banco de España.
    • Handle: RePEc:bde:wpaper:0821
    as

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    File URL: http://www.bde.es/f/webbde/SES/Secciones/Publicaciones/PublicacionesSeriadas/DocumentosTrabajo/08/Fic/dt0821e.pdf
    File Function: First version, October 2008
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    credit lines; firm default; bank lending; exposure at default;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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