Bank Loans with Chinese Characteristics: Some Evidence on Inside Debt in a State-Controlled Banking System
研究中国国有银行基于内部信息放贷，发现财务差、费用高的企业更易获贷，但贷款后业绩下滑，市场对贷款公告反应负面，揭示国有金融体系的困境。
Abstract We study a transitional economy where state-controlled banks make loan decisions based on noisy inside information on prospective borrowers, and may lend to avert unemployment and social instability. In China, poor financial performance and high managerial expenses increase the likelihood of obtaining a bank loan, and bank loan approval predicts poor subsequent borrower performance. Negative event study responses occur at bank loan announcements, particularly for borrowers measuring poorly on quality and creditworthiness, or for lenders or borrowers involved in litigation regarding loans. Our results highlight dilemmas in a state-led financial system and the local stock market’s sophistication in interpreting news.