Asymmetric information and bank access to financing.

摘要

This study investigates whether asymmetric information restricts a firm's access to external financial markets and whether access to the internal capital market of a conglomerate mitigates the financial constrains faced by a subsidiary of the conglomerate. The second chapter of this study shows that financial market imperfections do matter for a firm's access to external finance. Banking data allow the use of a superior than in previous literature measure of the degree of information asymmetry across firms by distinguishing between publicly traded and non-publicly traded firms (banks). It is shown that publicly traded banks, which exhibit a lower degree of information asymmetry, are better able to overcome financial market frictions, compared to the relatively opaque non-publicly traded banks, when monetary policy is tightened. Lending by the more transparent publicly traded banks is less affected by a monetary policy tightening in large part due to their ability to issue uninsured large time deposits. These results are obtained controlling for firm (bank) size, a dimension commonly used in the literature as the measure of the degree of firm access to external finance.; By investigating the mechanisms underlying capital allocation within banking organizations, the third chapter of this study provides evidence that internal capital markets are operative in banking and that they are used to mitigate financial constraints faced by bank subsidiaries. Recognizing that differences in the capital positions among its subsidiaries may generate incentives for internal capital management within a multibank holding company, this chapter shows that multibank holding companies do move funds among their subsidiaries with differing capital ratios. Importantly, it is shown that internal capital management within a multibank holding company involves not only the movement of capital from more capitalized to less capitalized subsidiaries, but also the movement of assets (loans) from less capitalized to more capitalized subsidiaries by means of loan sales and purchases among the subsidiaries. This second mechanism is unique for the banking industry and overlooked in the existing literature on the operation of internal capital markets in banking. Ignoring this mechanism may seriously understate the volume of activity in the internal capital markets in banking.