Header

UZH-Logo

Maintenance Infos

Securitization and lending standards: Evidence from the European wholesale loan market


Ongena, Steven; Kara, Aper; Marques-Ibanez, David (2016). Securitization and lending standards: Evidence from the European wholesale loan market. Journal of Financial Stability, 26:107-127.

Abstract

We assess the effect of securitization activity on banks’ lending rates employing a uniquely detailed dataset from the euro-denominated syndicated loan market. We find that, in the run up to the 2007-2009 crisis banks that were more active at originating asset-backed securities did not price their loans more aggressively (i.e. with narrower lending spreads) than less-active banks. Using a unique feature of our dataset, we show that also within the set of loans that were previously securitized, the relative level of securitization activity by the originating bank is not related to narrower lending spreads. Our results suggest that while the credit cycle seems to have a major impact of lending standards, the effect of securitization activity appears to be very limited.

Abstract

We assess the effect of securitization activity on banks’ lending rates employing a uniquely detailed dataset from the euro-denominated syndicated loan market. We find that, in the run up to the 2007-2009 crisis banks that were more active at originating asset-backed securities did not price their loans more aggressively (i.e. with narrower lending spreads) than less-active banks. Using a unique feature of our dataset, we show that also within the set of loans that were previously securitized, the relative level of securitization activity by the originating bank is not related to narrower lending spreads. Our results suggest that while the credit cycle seems to have a major impact of lending standards, the effect of securitization activity appears to be very limited.

Statistics

Citations

Dimensions.ai Metrics
2 citations in Web of Science®
1 citation in Scopus®
4 citations in Microsoft Academic
Google Scholar™

Altmetrics

Downloads

1 download since deposited on 25 Jan 2017
0 downloads since 12 months
Detailed statistics

Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Banking and Finance
Dewey Decimal Classification:330 Economics
Language:English
Date:October 2016
Deposited On:25 Jan 2017 10:46
Last Modified:02 Feb 2018 11:43
Publisher:Elsevier
ISSN:1572-3089
OA Status:Closed
Publisher DOI:https://doi.org/10.1016/j.jfs.2016.07.004
Related URLs:http://www.sciencedirect.com/science/article/pii/S1572308916300572?np=y (Publisher)
Other Identification Number:merlin-id:13504

Download