Research On How To Relieve Financial Distress Of Medium-sized And Small Enterprises

In our national economic system, medium-sized and small enterprises are always holding an important position. However, their present condition of currency fond is not so optimistic, financial distress seriously restricts the further development of medium-sized and small enterprises. Through analysis of the factors which cause this financial distress, the providers of capital and the demanders of capital both have some relevant problems, among these problems, information asymmetry between banks and enterprises is the most important factor which causes financial distress for medium-sized and small enterprises.This article mainly focuses on small bank advantages. First, we state relaionship lending theory and bank size theory in detail, on the basis of these two theories, we carry on empirical analysis. Sample data is derived from Shenzhen SZSE small plates. We choose effective data to build multiple return model and carry on empirical analysis about medium-size and small enterprises’lending effect from relationship between banks and enterprises and bank size. The result proves existence of small bank advantages. At last, according to the result above and present lending condition of our banks, this article puts forward reasonable suggestions about how to improve the small bank system, how to develop relationship lending and small syndicated loan and how to encourage large banks to exploit credit products aimed at medium-sized and small banks.