Gender board diversity and the cost of bank loans

Karavitis, P. , Kokas, S. and Tsoukas, S. (2021) Gender board diversity and the cost of bank loans. Journal of Corporate Finance, 71, 101804. (doi: 10.1016/j.jcorpfin.2020.101804)

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We examine the relationship between female board representation and the cost of lending, using a dataset of 13,714 loans from 386 banks matched with 2432 non-financial firms from 1999 to 2013. We find that firms with female directors command lower loan spreads. In addition, female independent directors have a stronger impact on lowering spreads compared to female directors' other attributes. However, as firms build relationships with their lenders this effect becomes less potent. Finally, when we introduce firm-level heterogeneity we document that changes in gender diversity exert a stronger impact on the cost of lending in the case of bank-dependent firms, especially for relationship borrowers.

Item Type:Articles
Glasgow Author(s) Enlighten ID:Karavitis, Dr Panagiotis and Tsoukas, Professor Serafeim
Authors: Karavitis, P., Kokas, S., and Tsoukas, S.
College/School:College of Social Sciences > Adam Smith Business School > Accounting and Finance
Journal Name:Journal of Corporate Finance
ISSN (Online):1872-6313
Published Online:09 January 2021
Copyright Holders:Copyright © 2021 Elsevier
First Published:First published in Journal of Corporate Finance 71: 101804
Publisher Policy:Reproduced in accordance with the copyright policy of the publisher

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