Please use this identifier to cite or link to this item: http://hdl.handle.net/11718/24347
Title: Risk-sensitive Basel regulations and firms' access to credit: direct and indirect effects
Authors: Gopalakrishnan, Balagopal
Jacob, Joshy
Mohapatra, Sanket
Keywords: Basel regulations;Real effects;Credit risk;Trade credit;Credit rating
Issue Date: 9-Mar-2021
Publisher: Elsevier
Citation: Gopalakrishnan, B., Jacob, J., & Mohapatra, S. (2021). Risk-sensitive Basel regulations and firms’ access to credit: Direct and indirect effects. Journal of Banking & Finance, 126, 106101.
Abstract: This paper examines the impact of risk-sensitive Basel regulations on debt financing of firms around the world. It investigates how firms cope with the impact through adjustments to their financing sources and capital investments. We find that the implementation of Basel II regulations is associated with reduced credit availability for lower-rated firms. Such firms mitigate the shortage in bank credit through increased reliance on accounts payable, lower payouts to shareholders, and reduced capital investments. The impact of the capital regulation is lower in countries that rely on the internal ratings-based approach. The key results are robust to controls for banking crises, bank-specific controls, and the inclusion of loan-level information. The findings of this paper substantially contribute to the understanding of the real effects of risk-sensitive bank capital regulations.
URI: http://hdl.handle.net/11718/24347
Appears in Collections:Journal Articles

Files in This Item:
File Description SizeFormat 
Risk-sensitive Basel regulations and firms’ access to credit_Direct and indirect effects.pdf
  Restricted Access
Risk-sensitive Basel regulations and firms’ access to credit: Direct and indirect effects1.06 MBAdobe PDFView/Open Request a copy


Items in IIMA Institutional Repository are protected by copyright, with all rights reserved, unless otherwise indicated.