Parent Influence on Loan Pricing by Czech Banks

0386173 - ÚTIA 2013 RIV CZ eng J - Článek v odborném periodiku
Derviz, Alexis - Raková, M.
Parent Influence on Loan Pricing by Czech Banks.
Prague Economic Papers. Roč. 21, č. 4 (2012), s. 434-449. ISSN 1210-0455. E-ISSN 2336-730X
Institucionální podpora: RVO:67985556
Klíčová slova: multinational bank * interest rate * internal capital market
Kód oboru RIV: AH - Ekonomie
Impakt faktor: 0.561, rok: 2012
http://library.utia.cas.cz/separaty/2013/E/derviz-parent influence on loan pricing by czech banks.pdf

We investigate the influence which the financial condition of a multinational bank group may have on the lending rates of its affiliates, using data from the ten biggest banks in the Czech Republic under foreign control. The analysis is based on a theory of bank lending in which the implicit opportunity costs of lending by a foreign bank affiliate are influenced by the scarcity of funds within the multinational conglomerate. The theory predicts that parent banks’ influence should be stronger in loan segments with more pronounced information asymmetry. Our empirical model, which explains the interest rate charged by the affiliate by means of affiliate-level controls and a parent influence variable, is tested for three categories of commercial non-financial borrowers (domestically owned firms, foreign-owned firms and the self-employed).
Trvalý link: http://hdl.handle.net/11104/0216172