Abstract
This paper investigates the mechanisms behind the matching of banks and firms in the loan market and the implications of this matching for the provision of credit. I find that bank-dependent firms borrow from well capitalized banks, while firms with access to the bond market borrow from banks with less capital. This matching improves access to credit during a crisis by pairing bank-dependent firms with stable banks. During the 2008 Financial Crisis, bank-dependent borrowers faced significantly greater loan supply from their relationship banks than they would have without this matching.
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