抄録
This study investigates the competitive position of Japanese megabanks in China. Japanese banks have taken an offensive position and started expanding to overseas, especially in China, after the repayment of public funds. Such a development is of great business and academic interest. As lending behavior is one of the measures of success or failure of overseas expansion, this study tries to assess how Japanese banks compete in a syndicated loan market. The study divides loan transactions into two groups on the basis of participation of Japanese banks, and compares the lending terms as well as borrowers’ characteristics to elucidate the features of loan transactions performed by Japanese banks. Furthermore, a probit model that can control several explanatory
variables simultaneously is used to detect the lending behaviors of Japanese banks. The main results of this analysis are as follows. First, the most distinctive feature of Japanese loan transactions is that Japanese banks lend to Japanese as well as foreign companies. In these transactions, only few borrowers are state enterprises, local government projects, and companies with a listed parent company. Though, in common assumption, this set of borrowers should encourage Japanese banks to participate in loan transactions, the analysis showed an opposite result.
Second, the loans given by Japanese banks are mainly used for working capital and refinancing. A comparison of loan maturities revealed that Japanese banks preferred to provide short-term loans. These features of Japanese banks’ lending behavior can be explained by follow-the-client hypothesis used in the research studies of multinational banks. The lending behavior of Japanese banks is rational because loans to Japanese companies result in a lower marginal cost of information due to availability of credit information accumulated in domestic loan transactions, more intense long-term relationships, and contributions to deeper domestic transactions.
