Using a panel of about 6,000 firms from the Mannheim innovation survey, westudy whether stricter bank regulations have changed the funding mix of firms.In particular, we shed light on the question of whether the importance of bank financingfor tangible investments or innovation expenditures has decreased sincestricter regulations were imposed. The results of the multivariate probit modelsshow that the likelihood of using bank loans for financing tangible investmentsor innovation expenditures has not changed following stricter bank regulations.Thus, banks did not, on average, reduce their lending to firms for tangible investmentsor innovation expenditures due to stricter regulatory requirements