The role of asset management companies in the Turkish banking system and the impact on credit rationing of banks

The main purpose of the actors in supply side of the market in economics is to ensure profit maximization. This is also true for the banking sector. All sectors in the economy have different profitability and risks within themselves. The risk structure of loans, which have the largest share in the assets of the banking sector, is also an important determinant of profitability. In the banking sector, the risk is determined by whether the loans are used in accordance with the purpose, whether the payments are made in the planned maturity, and whether the solvency of the borrower is determined correctly. In economic theory, the existence of asymmetric information in the markets makes this determination difficult and may increase the repayment risk of loans. In this study, it is tried to analyze whether banks restrict their lending behavior (credit rationing) when they encounter increasing credit risk in the market due to asymmetric information in economic theory according to terms, which there are asset management companies, that banks transfer their credit risks. In this study, an empirical VAR analysis was conducted by using monthly data, classified into two groups according to the terms, which there are asset management companies and there are not, from December 2002 to May 2020. According to the result of the analysis, it was concluded that the increase in the credit risk cause more credit rationing in the term, which there are no asset management companies, comparing to term, which there are asset management companies.