the effects of branch manager’s characteristics on micro-lending quality: evidence from a commercial bank in iran

Based on financial literature, when information asymmetry is present, the agency problem can affect the bank’s lending. in this regard, the contract between the bank and the bank’s agents (who are involved in the lending process) and monetary incentives are very crucial. furthermore, the career concerns and the characteristics of the bank’s agents can affect the agents’ performance and the effectiveness of the bank’s monetary incentives. this paper investigates the effects of the characteristics of the branch managers on microloans quality in an iranian commercial bank. results show that (1) the micro-lending quality of the female branch managers is better than their male counterparts; (2) the quality of micro-lending managed by older branch managers (or branch managers who are closer to retirement age) is poorer than that of their younger counterparts; (3) the higher education of the branch managers improves the quality in micro-lending.