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Determinants of long‐ versus short‐term bank credit in EU countries
Author(s) -
Anderson Haelim Park,
RuizOrtega Claudia,
Tressel Thierry
Publication year - 2017
Publication title -
international journal of finance and economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.505
H-Index - 39
eISSN - 1099-1158
pISSN - 1076-9307
DOI - 10.1002/ijfe.1583
Subject(s) - emerging markets , economics , sample (material) , bank credit , monetary economics , term (time) , bond market , financial system , international economics , macroeconomics , chemistry , physics , chromatography , quantum mechanics
This paper empirically examines the determinants of credit at different maturities across countries of the European Union during the last decade. We document the lengthening of maturities since the early 2000s and whether these patterns were driven by similar factors in advanced and emerging market economies. Before the 2008 crisis, long‐term credit expanded faster than short‐term credit in most countries of our sample and contracted less than short‐term credit after 2008. We find that foreign liabilities were more important sources of funding in emerging market countries than in advanced economies. In addition, aggregate demand mattered less for credit extension to firms in emerging market countries than in advanced countries.