Factors Influencing Syndicated Loan Spreads: A Review of Literature

Abstract

In this paper we review the literature on factors influencing syndicated loan spreads, the mechanics and the direction of the impact. The review is structured around four major groups of factors on syndicated loan spreads: loan characteristics, borrower characteristics, country characteristics and lender characteristics. It is intended to facilitate the development of testable hypotheses for different time periods and different geographical samples of countries. It can also serve as a guide for policymakers looking to identify potential indicators that can serve as a basis for further analyses in order to provide recommendations for lowering the cost of funding for borrowing firms.

Keywords: syndicated loans, determinants, loan spreads, literature review

DOI: 10.7176/JESD/13-18-03

Publication date:September 30^th 2022