What Kinds of Credit Associations Favor Introducing New Financial Technology?

10 Pages Posted: 18 Dec 2009

See all articles by Nobuyoshi Yamori

Nobuyoshi Yamori

Kobe University - Research Institute for Economics & Business Administration

Kei Tomimura

Nagoya University

Kozo Harimaya

Sapporo Gakuin University

Date Written: December 15, 2009

Abstract

Since 2003, the Financial Services Agency has set relationship banking enhancement program as an important strategic task to improve the functions of regional financial institutions. In this enhancement program, the FSA recommended that regional financial institutions introduce new financial products such as collateralized loan obligations (CLOs) and collateralized bond obligations (CBOs). However, this was left up to each institution’s discretion rather than being mandatory. This resulted in a large difference in the introduction of new products. Therefore, this paper has analyzed what kinds of credit associations favorably increased the use of new financial products. As a result, it has been confirmed that the larger their lending shares and management scale, and the better their business conditions are, the more positively they work on the introduction of new products. Considering the fact that relationships between financial institutions and enterprises tend to be fixed in Japan, this means that medium and small enterprises will have restrictions on the financial products they can use depending on the situation of their main banks.

Keywords: Small businesses, New financial products, Relationship banking, Credit associations, Japan

JEL Classification: G21, G32

Suggested Citation

Yamori, Nobuyoshi and Tomimura, Kei and Harimaya, Kozo, What Kinds of Credit Associations Favor Introducing New Financial Technology? (December 15, 2009). Available at SSRN: https://ssrn.com/abstract=1523690 or http://dx.doi.org/10.2139/ssrn.1523690

Nobuyoshi Yamori (Contact Author)

Kobe University - Research Institute for Economics & Business Administration ( email )

2-1, Rokkodai cho
Nada-ku
Kobe, 657-8501
Japan

Kei Tomimura

Nagoya University ( email )

Furo-cho, Chikusa-ku
Nagoya-City, 4648601
Japan

Kozo Harimaya

Sapporo Gakuin University ( email )

Sapporo 062-8520
United States

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