arbiter
JournalsAccount

The Side Effects of Shadow Banking on Banks’ Liquidity Provision

Teodora Paligorova & João A C Santos

Review of Corporate Finance Studies2026https://doi.org/10.1093/rcfs/cfag004article
AJG 3ABDC A*
Weight
0.50

Abstract

The presence of shadow banks in corporate term loan syndicates adversely affects credit lines’ liquidity provision, despite shadow banks not directly funding credit lines. Within the same syndicated loan deal, shadow banks attract not only riskier borrowers but also fewer banks as co-lenders, both in the term loan and in the credit line. Furthermore, credit lines in deals funded by shadow banks, compared to those without shadow bank participation, are smaller, with shorter maturities, and lower drawdown rates. Overall, our results highlight that syndicated loan deals with a strong presence of shadow banks offer borrowers lower liquidity protection. JEL G21, G22, G23

Open via your library →

Cite this paper

https://doi.org/https://doi.org/10.1093/rcfs/cfag004

Or copy a formatted citation

@article{teodora2026,
  title        = {{The Side Effects of Shadow Banking on Banks’ Liquidity Provision}},
  author       = {Teodora Paligorova & João A C Santos},
  journal      = {Review of Corporate Finance Studies},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1093/rcfs/cfag004},
}

Paste directly into BibTeX, Zotero, or your reference manager.

Flag this paper

The Side Effects of Shadow Banking on Banks’ Liquidity Provision

Flags are reviewed by the Arbiter methodology team within 5 business days.

Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.