edited by Morten Balling, Beat Bernet and Ernest Gnan, Vienna, 2009
Small and medium-sized enterprises are a centrepiece of Europe's economy. Due to their limited size and their generally lower creditworthiness, their access to financial market instruments is more limited than for large enterprises, which benefit from more elaborate Treasury operations, economies of scale also in their financing operations and, in particular, from access to securitized lending and stock markets. These limitations for SMEs may seriously limit their expansion potential and, in particular when it comes to lack of risk capital, their innovation and R&D activity. Against this background, a conference on "Financing SMEs in Europe" was jointly organised by SUERF and the Banque de France on 11 and 12 September 2008 in Paris. The conference addressed three issues: First, major theories of SMEs' financing behaviour were presented and evaluated. Second, the nexus between financing constraints and the growth and profitability of SMEs was investigated empirically on the basis of cross-country and a number of individual country case studies. Third, the special role of bank credit for SMEs, the consequences of Basel II on credit risk analysis and SMEs' possible strategic replies were discussed. This article aims to provide an overview of major lines of argument and insights derived from the conference, and draws some conclusions for the current financial crisis and economic downturn and for the longer-term.
Financing SMEs in Europe – Some Stylized Facts
Morten Balling, Beat Bernet and Ernest Gnan
Financing of business start-ups: a topic of great relevance for firm performance, growth and survival
Finance for Innovation and Growth
Vítor Gaspar, with Simona Bovha-Padilla and Reinhilde Veugelers
SME Financing in Europe: Measures to improve the rating culture under the new banking rules
Risk classification of SME loans - impact analysis for the use of different ratings models by banks
Beat Bernet and Simone Westerfeld
Keywords: Banks Rating Models, SME Financing, Ex-ante Risk Classification, Basel Capital Accord (Basel II), Capital Requirements Directive (CRD), capital structure, business start-ups, innovation, young innovative companies.
JEL Codes: G21, G32, O52
ISBN No.: 978-3-902109-48-4
Authors: Nancy Huyghebaert; Vítor Gaspar, with Simona Bovha-Padilla and Reinhilde Veugelers; Rym Ayadi; Beat Bernet and Simone Westerfeld
Editors: Morten Balling, Beat Bernet and Ernest Gnan