New Economics Papers
on Banking
Issue of 2008‒10‒13
three papers chosen by
Roberto J. Santillán–Salgado, EGADE-ITESM

  1. Duration of loan arrangement and syndicate organization By Godlewski, Christophe
  2. Paying for ATM usage : good for consumers, bad for banks ? By Donze, Jocelyn; Dubec, Isabelle
  3. The effects of regulating interchange fees at cost on the ATM market By Donze, Jocelyn; Dubec, Isabelle

  1. By: Godlewski, Christophe
    Abstract: What is the influence of syndicate organization on the duration of loan arrangement? I answer this question using the survival analysis methodology on a sample of loans from 59 countries over the 1992-2006 period. I find that syndicate size, concentration, reputation, and national diversity clearly matters for the duration of loan arrangement and therefore for borrower satisfaction regarding the speed of obtaining the necessary funding. A syndicate organization adapted to specific agency problems of syndication, with numerous, reputable, and experienced arrangers retaining a larger portion of the loan reduces the duration. The latter is also shorter when the lenders diversity in terms of nationality is weaker.
    Keywords: Syndicated loan; syndication process; duration of loan arrangement; agency costs; reputation; experience; nationality; survival analysis.
    JEL: F30 C41 G15 G32 G21
    Date: 2008–09
  2. By: Donze, Jocelyn; Dubec, Isabelle
    Abstract: We compare the effects of the three most common ATM pricing regimes on consumers’ welfare and banks’ profits. We consider cases where the ATM usage is free, where customers pay a foreign fee to their bank and where they pay a foreign fee and a surcharge. Paradoxically, when banks set an additional fee profits are decreased. Besides, consumers’ welfare is higher when ATM usage is not free. Surcharges enhance ATM deployment so that consumers prefer paying surcharges when reaching cash is costly. Our results also shed light on the Australian reform that consists in removing the interchange fee.
    Keywords: Banks ; ATMs ; Interchange Fees ; Welfare
    JEL: G2 L1
    Date: 2008–09–16
  3. By: Donze, Jocelyn; Dubec, Isabelle
    Abstract: We show that regulating the interchange fee at cost reduces banks’ incentives to deploy free ATMs over time. Simultaneously, more and more pay-to-use ATMs are deployed by independent ATM deployers. These results are consistent with the recent evolution of the British ATM market.
    Keywords: Banks ; ATMs ; Interchange Fees ; Regulation
    JEL: G2 L1
    Date: 2008–10–03

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