Luís M. de Castro

Cross boundary relationships in Portuguese banking and corporate financial services

Conceptual analyses of buyer‐seller interaction in services are rare, particularly with reference to banking and financial services in general. This paper tries to apply the industrial network paradigm to relationships between firms and commercial banks in Portugal. It is argued that relationship banking is complex and embedded in an aggregate structure: banking networks. Three Portuguese case studies of corporate banking relationships are discussed. The paper examines the linkages between banks and factoring firms connected to the corporate banking relationships. It is argued that these linkages are forms of multi‐organizational partnering, in notion very similar to “internal” networks.

Business Relationships Dynamics and (In) Stability: A Comparative Case Study in Corporate Banking

This paper looks at the evolution of business banking relationships regarding the stability of the volume of trade between corporate clients and their banks. Ten cases of dyadic relationships were studied. For each relationship, we looked at the variations in trade volume both within calendar years (short periods of time) and throughout the duration of the relationship (long periods of time). Theses cases were compared in terms of their atmospheres (co-operation, accessibility, commitment, trust and conflict), the strength and the kind of bonds, and the existence (or not) of connected relationships. Both the bonds between clients and banks, and those to connected bank relationships seem to contribute to the stability of relationships. No relation was found between the stability of banking relationships and their atmospheres. Finally, ten factors were identified that can interfere with relationships for short periods of time: three factors concern the client (bargaining behaviour, power, and financial and economic situation), two factors concern the bank (personnel turnover and risk policy), and another two concern the economic transactions (cost, and financial and economic risk). Finally, three factors were ‘external’ to the relationships (connected relationships, market competitiveness, and sociopolitical/legal factors). Positive and negative impacts on relationships stability are also discussed.