Concentration of Banking Relationships in Switzerland: The Result of Firm Structure or Banking Market Structure?

Concentration of Banking Relationships in Switzerland: The Result of Firm Structure or Banking Market Structure?

Switzerland is one of the countries with the highest concentration of bank–customer relationships. The present paper seeks to find out whether this can be explained by the structure of Swiss firms or by the organization of the Swiss banking market. Using survey data from small and medium-sized enter...

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Bibliographic Details
Published in:Journal of financial services research Vol. 33; no. 2; pp. 101 - 126
Main Authors: Neuberger, Doris, Pedergnana, Maurice, Räthke-Döppner, Solvig
Format: Journal Article
Language:English
Published: Boston Springer US 01-04-2008
Springer
Springer Nature B.V
Series:Journal of Financial Services Research
Subjects:
Banking
Banking industry
banking market structure
Banks
Commercial banks
Cost control
Credit market
Customer relations
Economics and Finance
Enterprises
Finance
Financial economics
Financial Services
Financial systems
Hypotheses
Macroeconomics/Monetary Economics//Financial Economics
Market structure
multiple bank relationships
Regional banks
Relationship banking
Relationship lending
Small & medium sized enterprises-SME
small business finance
Statistical analysis
Studies
Swiss banks
Switzerland
Switzerland
multiple bank relationships
Relationship lending
small business finance
banking market structure
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Summary:Switzerland is one of the countries with the highest concentration of bank–customer relationships. The present paper seeks to find out whether this can be explained by the structure of Swiss firms or by the organization of the Swiss banking market. Using survey data from small and medium-sized enterprises in 1996 and 2002, we examine the influence of firm-, loan-, and bank-specific variables on the number of banking relationships. We find that firm and industry structure have the largest explanatory power, while banking market structure and conduct play a minor role. Relationship lending by state-owned cantonal banks and small regional banks tends to enhance the concentration of banking relationships.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
content type line 23
ISSN:0920-8550
1573-0735
DOI:10.1007/s10693-008-0026-7