Bank loan maturity and corporate investment
This study analyzes bank loan maturity and corporate investment linkage by using novel firm-level data covering the universe of all incorporated firms in Türkiye over the last decade. The results of the panel regression model with multi-dimensional fixed effects reveal that loan maturity has a signi...
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| Format: | Article |
| Language: | English |
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Elsevier
2024-12-01
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| Series: | Central Bank Review |
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| Online Access: | http://www.sciencedirect.com/science/article/pii/S1303070124000325 |
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| _version_ | 1850111907127623680 |
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| author | İbrahim Yarba Burak Deniz |
| author_facet | İbrahim Yarba Burak Deniz |
| author_sort | İbrahim Yarba |
| collection | DOAJ |
| description | This study analyzes bank loan maturity and corporate investment linkage by using novel firm-level data covering the universe of all incorporated firms in Türkiye over the last decade. The results of the panel regression model with multi-dimensional fixed effects reveal that loan maturity has a significant positive association with investment, indicating that longer debt maturity fosters corporate investment. The results reveal that the positive linkage between longer debt maturity and investment is more pronounced for small and medium-sized enterprises (SMEs). This is also the case for young firms and firms with high growth opportunities. Considering the evidence provided in the literature that bank lending conditions, including maturity structure, are highly cyclical and vulnerable to financial conditions and economic policy uncertainties, our findings highlight the importance of reducing the policy uncertainties as well as the importance of policies that make equity financing more attractive and deepen the capital markets. |
| format | Article |
| id | doaj-art-3be2b0558ea444d3a82dd0df5c288747 |
| institution | OA Journals |
| issn | 1303-0701 |
| language | English |
| publishDate | 2024-12-01 |
| publisher | Elsevier |
| record_format | Article |
| series | Central Bank Review |
| spelling | doaj-art-3be2b0558ea444d3a82dd0df5c2887472025-08-20T02:37:32ZengElsevierCentral Bank Review1303-07012024-12-0124410017810.1016/j.cbrev.2024.100178Bank loan maturity and corporate investmentİbrahim Yarba0Burak Deniz1Corresponding author.; Central Bank of the Republic of Türkiye, Research and Monetary Policy Department, TurkiyeCentral Bank of the Republic of Türkiye, Research and Monetary Policy Department, TurkiyeThis study analyzes bank loan maturity and corporate investment linkage by using novel firm-level data covering the universe of all incorporated firms in Türkiye over the last decade. The results of the panel regression model with multi-dimensional fixed effects reveal that loan maturity has a significant positive association with investment, indicating that longer debt maturity fosters corporate investment. The results reveal that the positive linkage between longer debt maturity and investment is more pronounced for small and medium-sized enterprises (SMEs). This is also the case for young firms and firms with high growth opportunities. Considering the evidence provided in the literature that bank lending conditions, including maturity structure, are highly cyclical and vulnerable to financial conditions and economic policy uncertainties, our findings highlight the importance of reducing the policy uncertainties as well as the importance of policies that make equity financing more attractive and deepen the capital markets.http://www.sciencedirect.com/science/article/pii/S1303070124000325C23D22E22G31G32 |
| spellingShingle | İbrahim Yarba Burak Deniz Bank loan maturity and corporate investment Central Bank Review C23 D22 E22 G31 G32 |
| title | Bank loan maturity and corporate investment |
| title_full | Bank loan maturity and corporate investment |
| title_fullStr | Bank loan maturity and corporate investment |
| title_full_unstemmed | Bank loan maturity and corporate investment |
| title_short | Bank loan maturity and corporate investment |
| title_sort | bank loan maturity and corporate investment |
| topic | C23 D22 E22 G31 G32 |
| url | http://www.sciencedirect.com/science/article/pii/S1303070124000325 |
| work_keys_str_mv | AT ibrahimyarba bankloanmaturityandcorporateinvestment AT burakdeniz bankloanmaturityandcorporateinvestment |