Speaker: Prof. Kent Matthews (Cardiff University)
Commentators: Liu Xiaoxing (Southeast University), Yin Wei (Southeast University)
Time: 4:00p.m.
Date: 31 August 2022 (Wednesday)
Tencent Meeting ID: 478-451-170
About Speaker:
Kent Matthews is a professor of finance at Cardiff University Business School, UK, and holds the honorary title of Sir Julian Hodge Professor of Banking and Finance in the UK. He has been engaged in research on banking and finance for more than 30 years. He has published 17 monographs, presided over 13 scientific research projects, and published nearly 100 journal papers, most of which were published in European Economic Review, Journal of Money, Credit and Banking, Journal of Bank and Finance, International Review of Financial Analysis and Journal of International Financial Markets, Institutions and Money and other related professional top journals. Professor Kent Matthews has a high reputation in the field of global banking and finance research. He is also an expert in China's banking industry and one of the experts in the "China-UK Cooperation Project" of the National Natural Science Foundation of China. He has been involved in policy formulation research at the UK National Institute for Economic and Social Research and the Bank of England and was a visiting scholar at the Hong Kong Monetary Authority.
Abstract:
It is well recognized that relationship banking helps to relieve the credit constraints faced by SMEs to access bank finance. Trust is an important part of relationship banking. However, the term trust is nebulous, and relationship banking means different things to different banks and different borrowers. How trust enables the credit market for SMEs through relationship banking is largely unexplored. Using a unique primary dataset of SMEs in the UK, we construct a measure of trust-based relationship banking from the perspective of the borrower. We examine the drivers of trust-based relationship banking in terms of organizational trust in the relationship manager, defined as the delegation of operational autonomy, along with local market and social capital factors, and the style of the bank-borrower relationship. Along with bank, firm, and market factors, trust-based relationship banking helped to reduce the credit constraints faced by SMEs in the decade following the global financial crisis.
