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A study of the recent literature on relationship lending and the effects of relationship lending in different contexts and the findings are presented.

A review of the historical patterns of external borrowings by Latin American countries from the 1970s to the 1990s is presented. The debt of Latin American countries increased by 27% annually from 1970 to 1981, a rate which decreased to 4.3% annually from 1982 to 1992. The changes in Latin American debt was examined in a time series model which incorporated the demand for loans, cost of borrowing, gross national product, GNP growth rate and the balance of payments. There was a positive correlation between GNP and GNP growth and the growth of foreign debt while there was negative correlation between trade balance the growth of foreign debt.

A study was conducted on the factors which affect foreign banking entry, activity and growth in states, as measured by assets or offices. Results revealed that foreign banks prefer to establish a presence in states with large bank market sizes and permissive entry regulations. In addition, these banks were found to choose states which boast of a large amount of foreign direct investments.