Move a little closer? Information sharing and the spatial clustering of bank branches.

This article examines how information sharing between banks affects the spatial clustering of their branches, using a theoretical model and empirical data from 56,555 branches owned by 614 banks across 19 Eastern European countries between 1995 and 2012. The study finds that the introduction of information-sharing regimes—such as public credit registries or private credit bureaus—encourages banks to open new branches in localities already served by other banks, increasing branch clustering and reducing spatial credit rationing by enabling firms to access credit from more distant banks. The effect is stronger in larger localities, in countries with higher-quality information-sharing systems, and among relationship banks that rely more on private soft information. These findings suggest that information sharing shifts banks' strategic focus toward proximity to competitors rather than borrowers, with implications for the geographic distribution of financial services and access to credit in emerging markets.