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Working Paper

Loan Sales, Implicit Contracts, and Bank Structure

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We document some recent changes in the market for loan sales. We use a Tobit model to characterize the determinants of loan sales and purchases by banks, relating quantities bought and sold to bank size, capital, risk, and funding mode. The results, though not definitive, broadly confirm the Pennacchi model of sales. Other data cast doubt on the importance of mergers and acquisitions for this market and on the comparability of different data sources.
10.01.1993ISSN 2573-7953 WP 93-07DOI 10.26509/frbc-wp-199307

Working Papers of the Federal Reserve Bank of Cleveland are preliminary materials circulated to stimulate discussion and critical comment on research in progress. They may not have been subject to the formal editorial review accorded official Federal Reserve Bank of Cleveland publications. The views expressed in this paper are those of the authors and do not represent the views of the Federal Reserve Bank of Cleveland or the Federal Reserve System.

Suggested Citation

Haubrich, Joseph G., and James B. Thomson. 1993. “Loan Sales, Implicit Contracts, and Bank Structure.” Federal Reserve Bank of Cleveland, Working Paper No. 93-07. https://doi.org/10.26509/frbc-wp-199307