earticle

영어

This study analyses the effect of firm characters on the choice of main bank in Pusan based on the regional financial market theory and the relationship banking. These theories say that a provincial bank is superior to a national bank in lending to regional firms that are small and opaque. Total 7,261 regional firms in Pusan(of which 68 are public and KOSDAQ or the third market listed corporations, of which 583 are firms whose assets are above 7 billion won, and of which 6,610 are small and medium firms whose assets are below 7 billion won) are surveyed. The results are as follows: the share of regional firms that borrow from national banks decreases as their scale measured by the number of workers becomes smaller and their opaqueness increases. Such a tendency becomes clearer when we exclude Kookmin Bank and Small and Medium Bank from national banks. But Pusan Bank, the only provincial bank in Pusan, have relatively closer lending relationships with medium sized firms and with firms whose assets are above 7 billion won which are thought to be more lucid than those whose assets are below 7 billion won. These results do not support the presuppositions of this study. These results are closely related with the facts that Kookmin Bank and Small and Medium Bank have begun to devote themselves in financing regional small and medium firms earlier than Pusan Bank. This study is the first that have shown the firm-bank relationships in the regional financial market in Korea.