@article{4586, abstract = {{This study examines the loan-pricing behavior of German banks for a large variety of retail and corporate loan products. We find that a bank’s operational efficiency is priced in bank loan rates and alters interest-setting behavior. Specifically, we establish that a higher degree of operational efficiency leads to lower loan markups, which makes prices more competitive and smoothes the setting of interest rates. By employing state-of-the-art stochastic frontier efficiency measures to capture a bank’s operational efficiency, we take a look at the bank customers’ perspective and demonstrate the extent to which bor-rowers benefit from cost-efficient banking. }}, author = {{Schlueter, Tobias and Busch, Ramona and Sievers, Soenke and Hartmann-Wendels, Thomas}}, journal = {{Credit and Capital Markets--Kredit und Kapital}}, keywords = {{interest rate pass-through models, error correction models, bank efficiency, cost efficiency, stochastic frontier analysis}}, number = {{1}}, pages = {{93--125}}, title = {{{Loan Pricing: Do Borrowers Benefit from Cost-Efficient Banking?}}}, doi = {{10.3790/ccm.49.1.93}}, volume = {{49}}, year = {{2016}}, }