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Federal Reserve Bank of San Francisco
Working Paper Series
Loan officers and relationship lending to SMEs
Hirofumi Uchida
Gregory F. Udell
Nobuyoshi Yamori
Abstract

Previous research suggests that loan officers play a critical role in relationship lending by producing soft information about SMEs. For the first time, we empirically confirm this hypothesis We also examine whether the role of loan officers differs from small to large banks as predicted by Stein (2002). While we find that small banks produce more soft information, the capacity and manner in which loan officers produce soft information does not seem to differ between large and small banks. This suggests that, although large banks may produce more soft information, they likely tend to concentrate their resources on transactions lending.


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Hirofumi Uchida & Gregory F. Udell & Nobuyoshi Yamori, Loan officers and relationship lending to SMEs, Federal Reserve Bank of San Francisco, Working Paper Series 2008-17, 2008.
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Keywords: Banks and banking ; Bank loans ; Commercial credit
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