February 2024 - Working Paper32155 We study specialized lending in a credit market competition model with private information. Two banks, equipped with similar data processing systems, possess general signals regarding the borrowers quality; the specialized bank, has access to an additional specialized signal. We study equilibria in...
April 2023 - Working Paper31077 Using supervisory data on the loan portfolios of large US banks, we document that these banks specialize by concentrating their lending disproportionately in a few industries. This specialization is consistent with banks having industry-specific knowledge, reflected in reduced risk of loan defaults,...