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The aim of this study is to understand the determinants of relationship between banks and nonfinancial corporations within Poland (which are considered relationship banking from this point onward).

The main sources of data used in the study are the large credit database (credit register of the National Bank of Poland (NBP)) and other aggregated data, including data from the Warsaw Stock Exchange and the NBP. Econometric panel logit methods have been used to test how different factors affect bank–firm relationships. Three main groups of factors have been investigated: the characteristics of the firm (i.e., size, ownership type, and R&D activity); the characteristics of the financial sector (i.e., competition in the banking sector); and macroeconomic conditions.

The findings demonstrate that Polish firms readily establish single-bank relationships, and firms with the highest quality of credit portfolios borrow often from multiple creditors. All conducted estimations demonstrated that the relationship between financing from a single bank and from foreign capital had a positive sign. Also, a decrease in concentration in the banking sector, which may be identified with an increase in competition, supports the establishment of relationship banking.

The study was performed using the data from large exposure database collected for supervisory purposes. Exposures (credits, derivatives, etc.) larger than 500 thousand PLN (approx. 120 thousand EUR) were only considered. Future research on bank–firm relationships should focus on the influence of financing costs, maintaining relationships when the borrower is in a difficult financial position, and other unique features of banks using the strategy of relationship financing.

The understanding of the characteristics of bank–firm relationships can help to improve banking practice and supervisory policy in Poland.

This study makes a noticeable contribution to the understanding of the banking sector and its relationships with nonfinancial corporations in Poland. It is the first empirical study on such a large sample of panel data from Polish banking sector and industries, too.

Interorganizational partner selection decisions are plagued with uncertainty. When making partnering decisions, firms strive to answer two questions: does the prospective partner have resources which can be used to generate value in the relationship; and will the partner be willing to actively share these resources and cooperate in good faith? Answers to these questions help reduce three types of uncertainty – partner capability uncertainty, partner competitiveness uncertainty and partner reliability uncertainty. For a relationship to benefit both partners, they have to possess complimentary resources of comparable quality, avoid explicit competition as well as be willing to engage in the cooperative behaviors within the confines of their relationship. In this paper, we examine the importance of prospective partners’ characteristics (differences in size, status and specialization) as well as their network characteristics (existence of a common partner and membership in the same clique) to the formation and longevity of their social relationships, as these characteristics reduce firms’ value generation and partner reliability uncertainty.

It is broadly recognized in China that funding risks due to a lack of sufficient financial support from banks are the most crucial constraints that prevent the growth of small and medium enterprises (SMEs). In developed economies, such as Japan and European countries, the relationship banking business model is commonly used to help support SMEs to deal with funding risks. In this chapter, we investigate whether the relationship banking business model can be applied in China. This chapter uses the results of a unique survey study that was conducted by Professor Hiroyuki Kato of Kobe University and Professor Tang Cheng of Chuo University. They studied 183 SMEs in Zhejiang Province in China. After cleaning the data, the final sample size for this study was 100 firms. Using this data, we estimated the ordered logistic and OLS models to examine several hypotheses regarding relationship banking. We found evidence suggesting that relationship banking can mitigate funding risks for SMEs in China. Our study suggests that, although Chinese banks are still underdeveloped in terms of providing relationship lending, promoting the relationship banking model may be a significant way to resolve the financial difficulties of Chinese SMEs. It is generally very difficult to test hypotheses regarding relationship banking in China because of a lack of relevant data about Chinese SMEs. Due to our unique data set, which contains relevant information directly provided by Chinese SMEs, we can examine these hypotheses.

This paper investigates the factors crucial for small and medium enterprises (SMEs) in establishing business relationships with banks in Pakistan.

To investigate how SMEs select banking relationships using criteria, such as decision factors, decision-makers, and decision processes, a comprehensive literature review was used to classify SMEs' decision factors for bank selection. A survey questionnaire was distributed to 200 SMEs, randomly selected from the Small and Medium Enterprise Development Authority database in Pakistan. Probit/Tobit model is estimated to explain the behavior of SMEs.

The results reveal that SMEs consider a bank's Reputation, Price, and Location essential while establishing bank relationships. SMEs tend to terminate relationships with banks when the Price and Location of the bank are considered essential factors in the relationship with the banks. Price and Location are necessary for SMEs to reduce banking relationships. The SMEs also tend to reduce if they get attractive offers, or the SMEs are recommended to make a banking relationship. This study also provides intuitions for bank policymakers to design policies to retain SME customers and attract new business relationships.

The research emphasizes the importance of competitive and transparent pricing strategies in designing products for SMEs. Banks must prioritize their Reputation and credibility to attract and retain relationships with SMEs.

The study attempts to provide evidence on the SME-Bank relationship focusing on the factors that are crucial for SMEs to decide while establishing business relationships with banks. Also, most of the related literature focuses on developed countries; this research adds to the literature on SMEs' behavior, particularly in a developing country's context.

The authors investigate the factors affecting the decision of small and medium-sized enterprises (SMEs) to do business with either small local banks or large commercial banks.

We combine various data sources on Polish SMEs, including their financial statements, county-level data on SMEs' local environment, information about bank branch locations, as well as a new survey on the specificity of bank–firm relationships. We employ the logit and Tobit models.

SMEs' bank choices and the length of a bank–firm relationship are more strongly associated with trust-related factors, rather than transactional ones. SME managers motivated by trust-related factors are more likely to choose local lenders and maintain long-term relationships with them. However, as firms grow and mature, SME managers lean toward banks adopting transaction-oriented policies.

We could have drawn a more detailed picture of the bank selection process had we been able to compare the traits of a firm's current and previous banks.

The study shows that the features of a bank's offer, including product prices, have limited potential in shaping long-term relationships between banks and SMEs.

The topic of bank selection by SMEs has not been thoroughly investigated in the case of Central European countries. We address this gap by comparing two types of potential drivers of bank selection: trust-related factors and a set of purely economic (transactional) motives.

Focuses on the relationships and interactions between banks and corporate clients. Explores the possibility of approaching the bank‐company relationship from a different angle. Today banks are facing more aggressive competition and unlimited opportunities. It has become of paramount importance for banks to restructure the relationships with their corporate clients. Our theoretical framework can be traced back to two major theoretical models from outside the bank marketing literature, i.e. the Interaction Approach and the New Concept of Marketing. Empirical data were collected by means of questionnaires. A total of 300 questionnaires were mailed to a random choice of different companies in Sweden. Responses were received from 179 companies (60 per cent). Identifies a large number of factors which influence the interactive relationship between banks and companies.

The purpose of this study is to investigate whether banks are needed as partners for internationalising small and medium‐sized enterprises (SMEs) and, if so, in what ways they affect SMEs. The purpose can, in a wider sense, shed light on institutions' intermediating functions for transactions in the economy, both locally and internationally.

A questionnaire was distributed to Swedish SMEs involved in international activities. A sample of 318 SMEs was used. The results are presented as descriptive statistics and by using t‐tests.

The findings show that banks are the least used source of information for internationalising SMEs. The results also show that banks do not participate in SME business networks when SMEs are internationalising. SMEs that have been dependent on banks when developing their international business relationships, however, tend to have previously depended on the bank when conducting business.

It is believed there is much to be gained, both for SMEs and banks, in developing their business exchange and reciprocal understanding. The bank can make SME international operations and financial situations flow more efficiently. This in turn may improve SME growth, thus creating more business opportunities between banks and SMEs.

The study fills a gap in the literature and knowledge concerning banks' effects on SMEs' internationalisation.

Investigates how large UK multinational firms evaluate individual and multiple banking relationships, and how they exercise control over their portfolios of banks. The identification and description of how firms do this is important for those banks marketing a wide range of financial services to the corporate sector. Between 1986 and 1990, 15 confidential corporate case studies were developed from interviews with UK firms. The case firms were a sample of 15 large UK‐based multinational companies (MNCs) drawn from the FT100. Senior finance personnel were interviewed during 1986‐90 in all 15 firms using a semi‐structured questionnaire. Uses a theoretical perspective to interpret this decision behaviour and explores the nature and function of these decision rules.

Banks and corporate customers have realized that bank-corporate relationship is important but little is known about why and how banks establish and exploit relationships. No comprehensive theory has explained relationship banking and in order to get a better understanding the purpose of this paper is to investigate why and how banks and companies communicate in order to create value.

This study adopts a qualitative methodology and a grounded theory approach was adopted. In total, 34 in-depth interviews were conducted with banks and 15 with corporate managers. Grounded theory models are developed based on interview data.

It was found that the nature of bank-corporate relationship is long term. The relationship is based on trust-based personal communications between banks and corporate customers. Macro conditions including the advances in technology, financial regulation and business globalization were considered when the case banks adopted relationship banking. Some intervening conditions including customer information and knowledge, customer needs and customer confidence also influence the development of relationship banking. The interviewees perceived that the case banks gained benefits including better customer retention economy, risk management efficiency and greater effectiveness in maintaining sustainable profitability. The corporate customers gained benefits including fund availability, product availability, service quality, help in-time and business platform.

This study derives concepts and categories from primary data and identifies relationships among these theoretical elements. This investigation provides a comprehensive picture of relationship banking and supplies some theoretical and practical implications. Moreover, a value creation and allocation theory of the bank is developed.

China as a main emerging and transition economy has since 2006 opened up its banking market to foreign competition. Thus far, the penetration of foreign banks has been only moderate with around 2 per cent market share of the total banking market, despite the widely held view that foreign banks operate at a higher level of efficiency and that Chinese state-owned banks (SOBs) operate at a lower level of efficiency. The purpose of this paper is to explore the relationship between bank ownership and the lending behaviour and relationship banking that stems from the Chinese tradition of “guanxi”.

Based on three bank types the authors construct a model of the choice of bank type and show how that model can be estimated using a multinomial logit. The authors assume that firms choose a bank type as a function of firm characteristics (Berger et al., 2008; Ongena and Sendeniz-Yüncü, 2011), deal terms (Machauer and Weber, 2000; Ziane, 2003), and industry classification (Uchida et al., 2008; Ongena and Sendeniz-Yüncü, 2011).

This paper finds the existence of a close banking relationship of a “guanxi” type between SOBs and state-owned enterprises (SOEs). This is shown up in the form of better deal terms for the SOE. In the case of foreign banks the authors find that a foreign bank-foreign owned enterprise relationship exists but this is based on risk quality and no advantages in deal terms, which suggest a more commercial-based relationship. The empirical findings are that transparent and high-quality firms are likely to engage with foreign banks, while state-owned firms are more likely to engage with SOBs.

In China, few studies have addressed the potentially important role of bank ownership on lending behaviour (e.g. Firth et al., 2008; Berger et al., 2009). The authors extend the analysis by distinguishing not only between foreign and domestic banks, but also between SOBs and other domestic banks. This research seeks to enhance the understanding of bank ownership, lending behaviour and relationship banking.