Christophe Godlewski, Bulat Sanditov, Thierry Burger-Helmchen
Journal of Business Finance and Accounting, 39, p. 113-140.
Année de publication : 2012

We investigate the network structure of bank lending markets and evaluate the impact of lenders’ network centrality, considered a measure of their experience and reputation, on borrowing costs. We show that the French market for syndicated bank loans is a ‘small world’ characterized by large local density and short social distances between lenders. Such a network structure allows for better information and resources flows between banks thus enhancing their social captial. We then show that lenders’ experience and reputation play a significant role in reducing loan spreads and thus increasing borrower’s wealth.