NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Organizational Complexity and Balance Sheet Management in Global Banks

Nicola Cetorelli, Linda S. Goldberg

NBER Working Paper No. 22169
Issued in April 2016
NBER Program(s):   IFM   ME

Banks have progressively evolved from being standalone institutions to being subsidiaries of increasingly complex financial conglomerates. We conjecture and provide evidence that the organizational complexity of the family of a bank is a fundamental driver of the business model of the bank itself, as reflected in the management of the bank’s own balance sheet. Using micro-data on global banks with branch operations in the United States, we show that branches of conglomerates in more complex families have a markedly lower lending sensitivity to funding shocks. The balance sheet management strategies of banks are very much determined by the structure of the organizations the banks belong to. The complexity of the conglomerate can change the scale of the lending channel for a large global bank by more than 30 percent.

You may purchase this paper on-line in .pdf format from SSRN.com ($5) for electronic delivery.

Access to NBER Papers

You are eligible for a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.

E-mail:

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w22169

Users who downloaded this paper also downloaded* these:
Banerjee, Chassang, and Snowberg w22167 Decision Theoretic Approaches to Experiment Design and External Validity
Drechsler, Savov, and Schnabl w22152 The Deposits Channel of Monetary Policy
Garín, Lester, and Sims w22177 Raise Rates to Raise Inflation? Neo-Fisherianism in the New Keynesian Model
Anderson, Bordo, and Duca w22100 Money and Velocity During Financial Crises: From the Great Depression to the Great Recession
Eggertsson, Mehrotra, and Summers w22172 Secular Stagnation in the Open Economy
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us