Bank Competition and Leverage Adjustments

Fuxiu Jiang; Zhan Jiang; Jicheng Huang; Kenneth A. Kim; John R. Nofsinger

doi:10.1111/fima.12174

journal article Mar 23, 2017

Bank Competition and Leverage Adjustments

Fuxiu Jiang Zhan Jiang

Jicheng Huang Kenneth A. Kim John R. Nofsinger

Financial Management Vol. 46 No. 4 pp. 995-1022 · Wiley

View at Publisher Save 10.1111/fima.12174

Abstract

AbstractWe test whether bank competition affects firms’ leverage adjustment speeds. Using Chinese data where bank concentration varies across both years and provinces, we find that underlevered firms move to their target leverage faster when bank competition is high. Tests surrounding an exogenous shock to bank competition lead to the same conclusion. We also find that small firms and nonstate‐owned firms exhibit faster leverage adjustments when bank competition is high, which is consistent with the conjecture that bank risk taking increases with competition.

Topics

No keywords indexed for this article. Browse by subject →

References

67

[1]

10.1016/j.jfineco.2004.06.010

[2]

10.1017/cbo9780511754234.015

[3]

Almanac of China's Finance and Banking Editorial Board (1999)

[4]

10.1016/j.jce.2004.07.002

[5]

10.1016/j.jfineco.2008.04.003

[6]

10.1016/j.jmoneco.2005.10.014

[7]

10.1353/mcb.2004.0039

[8]

10.1016/s0378-4266(98)00125-3

[9]

Bank ownership and efficiency in China: What will happen in the world’s largest nation?

Allen N. Berger, Iftekhar Hasan, Mingming Zhou

Journal of Banking & Finance 10.1016/j.jbankfin.2007.05.016

[10]

10.1111/1540-6261.00513

[11]

10.1016/s0304-4076(98)00009-8

[12]

10.1353/mcb.2004.0011

[13]

10.1111/j.1540-6261.2005.00763.x

[14]

10.1111/j.1540-6261.2008.01421.x

[15]

10.1086/651201

[16]

Finance as a Barrier to Entry: Bank Competition and Industry Structure in Local U.S. Markets

NICOLA CETORELLI, Philip E. Strahan

The Journal of Finance 10.1111/j.1540-6261.2006.00841.x

[17]

10.1016/j.jbankfin.2012.03.003

[18]

10.1016/j.jbankfin.2013.02.002

[19]

China Securities Regulatory Commission (2010)

[20]

10.1111/0022-1082.00181

[21]

10.1016/j.jfi.2008.08.004

[22]

10.1016/j.jbankfin.2007.12.034

[23]

10.1016/s0304-405x(99)00039-2

[24]

Fan G. (2012)

[25]

10.1016/j.jce.2008.05.001

[26]

10.1093/jleo/ews028

[27]

10.1016/j.jfineco.2011.10.013

[28]

10.1093/rfs/hhj003

[29]

10.1016/j.jcorpfin.2012.09.004

[30]

10.1016/j.jfineco.2005.03.004

[31]

10.1111/j.1755-053x.2009.01026.x

[32]

10.2307/4126769

[33]

10.1016/s0304-405x(01)00044-7

[34]

10.1007/pl00004091

[35]

Hale G. "Prospects for China's Corporate Bond Market" Federal Reserve Bank of San Francisco Economic Letter (2007)

[36]

10.1016/0378-4266(91)90042-k

[37]

10.2307/1992764

[38]

10.1017/s0022109009090152

[39]

10.1016/j.jcorpfin.2014.10.010

[40]

10.1016/j.mulfin.2013.03.007

[41]

10.1016/s0304-405x(02)00249-0

[42]

10.1111/j.1540-6261.2009.01461.x

[43]

10.1111/j.1540-6261.2005.00811.x

[44]

Lemmon M. "Back to the Beginning: Persistence and the Cross‐Section of Corporate Capital Structure" Journal of Finance (2008)

[45]

10.1016/j.jbankfin.2015.04.005

[46]

10.1016/j.jce.2009.07.001

[47]

10.1016/j.jbankfin.2010.09.015

[48]

10.1016/j.jbankfin.2015.02.012

[49]

Martin M.F. 2012 China's Banking System: Issues for Congress Congressional Research Service Report for Congress. Available at:www.crs.gov.

[50]

Monetary Policy Analysis Group in People's Bank of China (2009)

Showing 50 of 67 references

Cited By

56

Bank competition and corporate employment: Evidence from the geographic distribution of bank branches in China

Shaojie Lai, Lihan Chen · 2023

Journal of Banking & Finance

Metrics

56

Citations

67

References

Details

Published: Mar 23, 2017
Vol/Issue: 46(4)
Pages: 995-1022
License: View

Authors

Cite This Article

Fuxiu Jiang, Zhan Jiang, Jicheng Huang, et al. (2017). Bank Competition and Leverage Adjustments. Financial Management, 46(4), 995-1022. https://doi.org/10.1111/fima.12174

Bank Competition and Leverage Adjustments

You May Also Like