Description

Using confidential credit-registry data on the universe of loans, we characterize the monthly behavior of relationship lending in Chile between 2012 and 2019. We focus on two dimensions of relationships between firms and banks: their duration, and their concentration. We uncover four stylized facts about relationship lending: their be-havior through time, cyclical properties, properties of credit contracts, and how they affect monetary policy transmission. Our results show that relationship lending plays an important role in the process of credit allocation.