BANK LENDING VS NON-BANK LENDING: AN ANALYSIS OF SELECTED ASIAN CREDIT MARKET.

The 2007/2008 global financial crisis has witnessed an increase of regulation on credit by the traditional bank sectors. As a result, businesses turned to a range of alternative financiers, such as leasing companies, money-market funds, mutual funds, which are collectively known as ‘shadow banks’, for credit. Using panel data of seven South East Asia countries for the period 2004-2013, the results show that this new alternative source of credit acts as complement to the traditional bank credits that has been existing decades ago. Further, although the shadow banks have grown is some part of the region, bank lending remains bigger than lending by these alternative financiers. The results also suggest that the ease of getting credit plays an important role in the development of this alternative financiers.