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The role of cross-selling in business banking relationships: Finnish evidence

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dc.contributor Aalto-yliopisto fi
dc.contributor Aalto University en
dc.contributor.author Paula, Arno
dc.date.accessioned 2016-08-16T11:35:43Z
dc.date.available 2016-08-16T11:35:43Z
dc.date.issued 2013
dc.identifier.uri https://aaltodoc.aalto.fi/handle/123456789/21296
dc.description.abstract The purpose of this study is to show that income-subsidization from cross-selling of fee income products is an important source of strength in business banking relationships. I show that in excess to the accumulation of soft information on the client during the course of banking relationship, the income-subsidization from fee income products is an important dimension and a source of relationship strength for the bank. I study the impact of cross-selling and relationship concentration on the loan rate using different product and fee income as well as novel deposit and payment share-of-wallet variables. I use a unique business customer dataset provided by a commercial bank operating in Finland. The sample consists of 538 client firms that have lending relationship with the bank during a one year observation period. In addition to complete credit exposure and income information, the data retrieved from the bank's internal database includes information on the fee income dimension of each client's relationship as well as bank's proprietary credit scoring. In addition, I have deposit and payment data as well as length of relationship available. Finally, I have other important client characteristics to control for the variables often employed in existing studies. Results give indication that the non-credit fee income dimension of the relationship has both statistically and economically important association with the loan price. I show that the number of non-lending product lines as well as fee income has negative impact the loan rate. In addition, the analysis of concentration using novel deposit and payment share-of-wallet variables provide further evidence that cross-selling of fee income products provides income-subsidization benefits to the bank. en
dc.format.extent 83
dc.language.iso en en
dc.title The role of cross-selling in business banking relationships: Finnish evidence en
dc.type G2 Pro gradu, diplomityö fi
dc.contributor.school Kauppakorkeakoulu fi
dc.contributor.school School of Business en
dc.contributor.department Rahoituksen laitos fi
dc.contributor.department Department of Finance en
dc.subject.keyword banking relationships
dc.subject.keyword soft information
dc.subject.keyword cross-selling
dc.subject.keyword fee income
dc.subject.keyword hold-up problem
dc.subject.keyword concentration
dc.subject.keyword share-of-wallet
dc.subject.keyword bargaining power
dc.identifier.urn URN:NBN:fi:aalto-201609083510
dc.type.dcmitype text en
dc.programme.major Rahoitus fi
dc.programme.major Finance en
dc.type.ontasot Pro gradu tutkielma fi
dc.type.ontasot Master's thesis en
dc.subject.helecon rahoitus
dc.subject.helecon financing
dc.subject.helecon pankit
dc.subject.helecon banks
dc.subject.helecon informaatio
dc.subject.helecon information
dc.subject.helecon myynti
dc.subject.helecon sales
dc.subject.helecon palkkiot
dc.subject.helecon remuneration
dc.subject.helecon tuotto
dc.subject.helecon rate of return
dc.subject.helecon asiakkaat
dc.subject.helecon customers
dc.subject.helecon neuvottelut
dc.subject.helecon negotiation
dc.ethesisid 14474
dc.date.dateaccepted 2013-05-22
dc.location P1 I
local.aalto.openaccess no
local.aalto.idthes 14474


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