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題名 Does bank relationship matter for a firm`s investment and financial constraints? The case of Taiwan
作者 Shen, Chung-Hua;Wamg, Chien-An
沈中華
貢獻者 金融系
關鍵詞 Bank relationships; Investment; Financial constraints; Cash-flow sensitivity
日期 2005
上傳時間 23-Mar-2015 18:19:07 (UTC+8)
摘要 This paper investigates the effects of a bank relationship on reducing a firm`s financial asymmetric information in an investment function. A bank relationship is proxied by the number of banks that a firm engages for its borrowing activities. A bank relationship is further divided into two regimes, i.e., a strong and a weak bank relationship regime, where the former is defined as one with smaller number of loan related-bank, and the latter is one with a greater number. It is expected that a strong bank relationship reduces the asymmetric information, i.e., investment cash-flow sensitivity here. Based on the examination of unique Taiwanese bank transaction data, our results show that investment is less sensitive to cash flow when a firm has a strong bank relationship. This implies that the firm holds less cash flow in hand for future investment expenditures. By contrast, when a firm has a weak bank relationship, the investment is sensitive to cash-flow. Our results are robust regardless if the bank relationship is proxied by either the loan amount or loan duration.
關聯 Pacific-basin Finance Journal, 13(2), 163-184
資料類型 article
DOI http://dx.doi.org/10.1016/j.pacfin.2004.07.004
dc.contributor 金融系
dc.creator (作者) Shen, Chung-Hua;Wamg, Chien-An
dc.creator (作者) 沈中華zh_TW
dc.date (日期) 2005
dc.date.accessioned 23-Mar-2015 18:19:07 (UTC+8)-
dc.date.available 23-Mar-2015 18:19:07 (UTC+8)-
dc.date.issued (上傳時間) 23-Mar-2015 18:19:07 (UTC+8)-
dc.identifier.uri (URI) http://nccur.lib.nccu.edu.tw/handle/140.119/73959-
dc.description.abstract (摘要) This paper investigates the effects of a bank relationship on reducing a firm`s financial asymmetric information in an investment function. A bank relationship is proxied by the number of banks that a firm engages for its borrowing activities. A bank relationship is further divided into two regimes, i.e., a strong and a weak bank relationship regime, where the former is defined as one with smaller number of loan related-bank, and the latter is one with a greater number. It is expected that a strong bank relationship reduces the asymmetric information, i.e., investment cash-flow sensitivity here. Based on the examination of unique Taiwanese bank transaction data, our results show that investment is less sensitive to cash flow when a firm has a strong bank relationship. This implies that the firm holds less cash flow in hand for future investment expenditures. By contrast, when a firm has a weak bank relationship, the investment is sensitive to cash-flow. Our results are robust regardless if the bank relationship is proxied by either the loan amount or loan duration.
dc.format.extent 180705 bytes-
dc.format.mimetype application/pdf-
dc.relation (關聯) Pacific-basin Finance Journal, 13(2), 163-184
dc.subject (關鍵詞) Bank relationships; Investment; Financial constraints; Cash-flow sensitivity
dc.title (題名) Does bank relationship matter for a firm`s investment and financial constraints? The case of Taiwan
dc.type (資料類型) articleen
dc.identifier.doi (DOI) 10.1016/j.pacfin.2004.07.004en_US
dc.doi.uri (DOI) http://dx.doi.org/10.1016/j.pacfin.2004.07.004 en_US