Liquidity risk and maturity management over the credit cycle

Atif Mian, João A.C. Santos

Research output: Contribution to journalArticlepeer-review

44 Scopus citations


We show that firm demand-side factors are strong drivers of procyclical refinancing behavior over the credit cycle using novel data from the Shared National Credit program. Firms are more likely to refinance early when credit conditions are good to keep the effective maturity of their loans long and hedge against having to refinance in tight credit conditions. High credit quality firms are better able to hedge, making their refinancing propensity more sensitive to credit cycles than less creditworthy firms. There is a strong relationship between refinancing a loan, and subsequent growth in capital expenditure, especially when a loan is refinanced early.

Original languageEnglish (US)
Pages (from-to)264-284
Number of pages21
JournalJournal of Financial Economics
Issue number2
StatePublished - Feb 2018

All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics and Econometrics
  • Strategy and Management


  • Liquidity risk
  • Loan refinancing
  • Maturity management


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