Credit risk, owner liability, and bank loan maturities during the global financial crisis
Open accessAbstract
Abstract We relate credit risk and owners’ personal guarantees to bank loan maturities during the global financial crisis. The findings, which remain robust to reverse causality, show that firms rated as low risk, with a strong relationship with the bank, whose owners provided personal guarantees and with large loan sizes obtained longer maturities. Banks with larger nonperforming loans provided loans with shorter maturities. Firms with low‐ and high‐risk ratings that provided owners’ personal guarantees obtained longer maturities. These findings shed additional light on the relationship between risk and loan maturities and the role of personal guarantees in reducing information asymmetries.
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- Authors
- Duarte, F. D., Gama, A. P. M., & Gulamhussen, M. A.
- Affiliations
- Centro de Inovação e Investigação em Ciências Empresariais e Sistemas de Informação (PT)
- University of Beira Interior (PT)
- Iscte – Instituto Universitário de Lisboa (PT)
- Corresponding author
- Gama, Ana Paula Matias
- Venue
- European Financial Management
- Publisher
- Wiley
- Published
- 2019-10-08
- Volume
- 26
- Issue
- 3
- Pages
- 628-683
- ISSN
- 1354-7798 (ISSN-L)
- 1468-036X
- OpenAlex
- W2971729580
- Cited by
- 11
- References
- 37
- Citations by year
- 2026: 1 · 2024: 3 · 2023: 2 · 2022: 1 · 2021: 4
- FWCI
- 1.52
- Type
- journal article
- Language
- en
- Open access
- green
- hdl.handle.net
- Licence
- Locations
- European Financial Management (publishedVersion)
- Repositório do ISCTE-IUL (submittedVersion, cc-by-nc-nd)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Finance › Banking stability, regulation, efficiency
- Social Sciences › Business, Management and Accounting › Accounting › Corporate Finance and Governance
- Social Sciences › Economics, Econometrics and Finance › Finance › Credit Risk and Financial Regulations
- Keywords
- credit risk, personal guarantees, 2008 financial crisis, non-performing loans, information asymmetry, corporate debt, loan size, credit ratings, bank-firm relationships
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