Credit Supply, Flight to Quality and Evergreening: An Analysis of Bank-Firm Relationships after Lehman

摘要: This paper analyzes the effects of financial crisis on credit supply by using highly detailed data bank-firm relationships in Italy after Lehman’s collapse. We control for firms’ unobservable characteristics, such as demand and borrowers’ risk, exploiting multiple lending. find evidence a contraction supply, associated to low bank capitalization scarce liquidity. The ability borrowers compensate through substitution across banks appears have been limited. also document that larger less-capitalized reallocated loans away from riskier firms, contributing pro-cyclicality. Such ‘flight quality’ has not occurred smaller banks. argue this may reflected, among other things, evergreening practices. provide corroborating based borrowers' productivity interest rates at level.