Horvath, Balint L.Demirguc-Kunt, AsliHuizinga, Harry2019-10-102019-10-102019-10https://hdl.handle.net/10986/32521This paper investigates how international regulatory and institutional differences affect lending in the cross-border syndicated loan market. Lending provided through a foreign subsidiary is subject to subsidiary-country regulation and institutional arrangements. Multinational banks' choices between loan origination through the parent bank or through a foreign subsidiary provide information about these banks' preferences to operate in countries with varying regulations and institutions. The results indicate that international banks have a tendency to switch loan origination toward countries with less stringent bank regulation and supervision consistent with regulatory arbitrage, but that they prefer to originate loans in countries with higher-quality institutions related to financial market monitoring, creditor rights, and the speed of contract enforcement.CC BY 3.0 IGOREGULATIONCREDITOR RIGHTSSYNDICATED LOANSINTERNATIONAL LENDINGMULTINATIONAL BANKWorking PaperWorld Bank10.1596/1813-9450-9037