SME Development Banks: Conceptual Framework and Empirical Analysis

Abstract

In this paper we develop a conceptual framework to define small and medium-sized enterprise development banks (SMEDB). This conceptual effort is motivated by the lack of a clear definition of SMEDB. Once a consistent definition of SMEDB is provided, we compare a sample of banks that are SMEDB according to such definition with a sample of commercial banks. We conclude that it is possible to separate SMEDB from commercial banks in a statistically significant manner by taking into consideration a set of relevant financial indicators and we confirm the widespread idea that SMEDB play a crucial public/social role.