Keep walking? Geographical proximity, religion, and relationship banking

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2019-04-01

Author

Beck, Thorsten
Ongena, Steven
Şendeniz Yüncü, İlkay

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This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

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We investigate the geographical proximity of firms to their relationship banks. We find that Islamic banks are more remote to their borrowers. We also find that the probability for a firm to connect to a bank substantially decreases in distance, but that the choice along bank characteristics determines how potent distance is in its impact. If the bank in the vicinity is an Islamic bank, distance plays a more muted role, especially in cities with a high conservative party vote and higher trust in religious institutions. Overall, these findings suggest that the presence of banks with certain characteristics in the vicinity may determine the within-firm and across-firm configurations of observable firm-bank connections. (112 words).

Subject Keywords

Strategy and Management, Economics and Econometrics, Business and International Management, Finance

URI

https://hdl.handle.net/11511/46703

Journal

Journal of Corporate Finance

DOI

https://doi.org/10.1016/j.jcorpfin.2018.07.005

Collections

Department of Business Administration, Article

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Citation Formats

T. Beck, S. Ongena, and İ. Şendeniz Yüncü, “Keep walking? Geographical proximity, religion, and relationship banking,” Journal of Corporate Finance, pp. 49–68, 2019, Accessed: 00, 2020. [Online]. Available: https://hdl.handle.net/11511/46703.