Do Banks Lend Where They Borrow? A Study on Local Small Business Lending in the U.S.
Lending to businesses in counties where a bank has no branches is highly sensitive to economic conditions. During the 2007 recession, distant lending contracted far more sharply than local lending, leaving the share of loans made at a distance lower than it had been at the beginning of the century. This study suggests that the presence of local bank branches might help small businesses weather economic downturns. Read “Do Banks Lend Where They Borrow? A Study on Local Small Business Lending in the U.S.” to learn more.