Natural Bank Reliance

June 13, 2025

Download PDF More Formats on IMF eLibrary Order a Print Copy

More formats on IMF eLibrary Order a Print Copy

Preview Citation

Format: Chicago

Hannah L Winterberg. "Natural Bank Reliance", IMF Working Papers 2025, 115 (2025), accessed June 14, 2025, https://doi.org/10.5089/9798229013482.001

Export Citation

ProCite
RefWorks
Reference Manager

BibTex
Zotero

EndNote

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

The higher aggregate prevalence of loan over bond funding in Europe is not only driven by the well-documented differences in financial market settings but also strongly shaped by different firm characteristics. The European economy is more fragmented than the U.S. economy, and thus features a different firm distribution in terms of size and collateral availability. I estimate that if all European firms had access to a financial market like the U.S. market, their aggregate bond funding share would remain significantly smaller. This counterfactual suggests a limited potential for European corporate bond markets in the short and medium term.

Subject: Bonds, Financial institutions

Keywords: Bank reliance, Bonds, Corporate bond markets, Euro area., Europe, Firm size distribution

Publication Details

Pages:

48
Volume:

2025
DOI:

https://doi.org/10.5089/9798229013482.001
Issue:

115
Series:

Working Paper No. 2025/115
Stock No:

WPIEA2025115
ISBN:

9798229013482
ISSN:

1018-5941

IMF’s Work

RESOURCES

TOPICS

Flagship Publications

Other Publications

IMF reports and publications by country

Regional Offices

All News

See Also

For Journalists

Press Center

RESOURCES

FLAGSHIPS

KEY SERIES

IMF NOTES

IMF Working Papers