Loan Default Research Papers - Academia.edu (original) (raw)

Financial institutions approve and disburse loans to individuals and firms to generate profit for their sustainability. However, one major challenge financial institutions face is loan default. Multiple borrowing is widely acknowledged as a major factor that contributes to loan default; but there is virtually no empirical evidence in support of this claim especially in the case of sub-Saharan African countries. This study therefore examines the impact of multiple borrowing on loan default with evidence from small and medium enterprises (SMEs). We rely on primary data and employ the binary probit regression for our analysis. The results show that SMEs that have multiple borrowing are more likely to default. The study therefore recommends loan and credit officers of financial institutions to be more diligent and circumspect in their quality control checks and credit appraisal of prospective borrowers. Again, the study suggests establishment of more Credit Reference Bureaus under the Credit Reporting Act, 2007 (Act 726) which facilitate information sharing among financial institutions about credit activities of borrowers. These are likely to reduce incidence of loan default because potential defaulters will be exposed and subsequently their loan applications declined.

- by and +2
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- Finance, Small and Medium-scale Enterprises, Loan Default, Non performing loans

Credit institutions are seldom faced with problems dealing with single objectives. Often, decisions involving optimizing two or more competing goals simultaneously need to be made, and conventional optimization routines/models are incapable of handling the problems. This study applies the Fuzzy Simplex Generic Algorithm (a multi-objective optimization algorithm) in generating decision rules for predicting loan default in a typical credit institution. Empirical results show that the best indicators of default status are observed when repayment capacity and owners equity are low and the working capital is either low or high. Also, the two worst rule indicators are low repayment capacity, high owners’ equity and medium working capital or medium repayment capacity, low owners’ equity and high working capital.► We examine the difficulty of optimizing multiple goals in credit default forecast. ► This is problematic when competing decisions are being simultaneously optimized. ► Fuzzy Simplex Generic Algorithm is used to generate rules to predict loan defaults. ► The best indicator is low repayment capacity, owners’ equity, and working capital.

- by sanjoy das
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- Prediction, Neural Network, Fuzzy Inference, Genetic Algorithm

The purpose of the study is to determine the social and health impacts of microloan default on women by relying on in-depth interviews with a group of women who have failed to repay their microloans in Jordan. It is evident that defaulting on their microloans is a result of women's inability to repay those loans from the start. One of the predominant social repercussions of defaulting is the pressure and rebuke that women are subjected to by their family and community, especially when a woman faces prosecution for defaulting on her microloan. These repercussions have in turn led to constraints on women's mobility and caused damaged to her health and wellbeing. In many cases, such women resorted to emotional eating which consequently developed into obesity or being subject to severe stress caused her physical harm, such as dental damage or hair loss due to vitamin deficiencies.

The study shows that there are unpredictable factors influencing loan default in small-scale enterprises in Port Loko Municipality. A fishbone diagram which is a cause an effect tool was used to determine these factors. A brainstorming activity was used to get the views of participants with regard to the Research Question. The research question was to respond to a research objective which was "Are there unpredicted factors influencing loan default in small scale enterprises in Port Loko Municipality in Sierra Leone?". Reviews of necessary literature were done to aid the study. In the review, matters relating to loan default and possible causes were addressed. It is unfolded that there are some loan defaults that are as a result of the borrowers' lapses and others that are lenderoriented causes. The population size of one hundred and a random sample size of sixty people were used as participants to carry out the brainstorming activity. The population is comprised of smallscale enterprise owners and workers of credit or Microfinance institutions in the Municipality. Brainstorming participants proved that the death of clients or borrowers, internal insecurity, outbreak of diseases (Pandemic), Natural Disasters, and accident all significantly influence loan default of small-scale enterprises.

- by Texila International Journal
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- Management, Diagrams, Brainstorm, Factors

This paper gives an outline of the definition, causes (internal and external), effects of loan delinquency and possible strategies of managing delinquent loans in a firm.

- by Dzidzai Hwandi
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- Loan Default

Microfinance institutions have been extending loans to different deficit units in Ghana and this study aimed at
addressing the following issues: identifying the causes of loan default and the processes involved in granting
loan by Microfinance institutions in Ghana. The convenient and purposive sampling techniques were employed
to select respondents to provide answers to questionnaires. The population of the survey constituted the
management and non-management staff and customers of some selected microfinance institutions in Ghana.
Hypotheses of the study will be analyzed using correlation and regression. Results of the study show that there
are high positive correlation between the constructs of loan default causes and how loans are granted.
Keywords: Loan Default Rate, Monitoring and Repayment, Microfinance institutions.

- by Anthony Siaw
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- Financial Institutions and Markets, Profitability, Loan Default, Finance Accounting

Trabajo de investigación sobre el Riesgo de Crédito en los principales bancos españoles: Santander, BBVA, Caixabank, Sabadell y Bankia. El objetivo principal es la comparación, en base a criterios teóricos y prácticos, de parámetros de riesgo crediticio informados públicamente o estimados a partir de su información contable y financiera, obtenida a partir de informes financieros auditados, CNMV y agencias de calificación de los años 2016 a 2018. Se realiza metodología principalmente inductiva, a través de datos numéricos, aplicando técnicas de ratios y gráficos comparativos. Se concluye que los bancos españoles están reduciendo su riesgo crediticio, mejorando su gestión y transparencia.

- by Alberto Cano-González
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- Transparency, TRANSPARENCIA, Credit Risk Management, Basel III

The purpose of this research is to explore the factors that influence microfinance loan default in Sri Lanka. Both a deductive and a quantitative approach were employed. A structured questionnaire was designed by 5 Likert-scale. Questionnaires were distributed among 133 microfinance loan borrowers in the region of the Matugama Divisional Secretariat using convenient sampling. SPSS version 22 used to perform the exploratory factor analysis. The findings of this study confirmed three factors useful to explain microfinance loan default in Sri Lanka. These are the actions of the Microfinance Institute to control loan defaulting; the characteristics of the borrowers' family and loan group; and macroeconomic issues. The findings of this study could be used by managers of Microfinance Institutes to manage their credit risk and customer portfolio. Certain policy implications such as possibility of granting access to Credit Information Bureau of Sri Lanka, accessing credit history of customers and government decisions directing Microfinance Institutes to request securities from its customers are few of them.

“Microfinance” is the term which means that, providing financial services to the unbanked, rural, poor people who can’t be able to get conventional banking services. At present, there are 705 Microfinance Financial Institutions(MFI) in Bangladesh that actively working there to change the fate of the poor rural, and unbanked people. There are specific regulations that are fully abided by the MFIs in Bangladesh. In the 2018-19 fiscal year, these MFIs distribute 1201.91 Billion Takas as loans to the poor, unbanked people to change their fate by self-employment. By this amount, we can realize the role of MFIs in Bangladesh’s economy. But the present condition shuts the growth of that sector along with the growth of this economy. This pandemic hits upon all the sectors in Bangladesh and all over the world. In these circumstances, the researcher believes that microfinance can play a great role to recuperate the economy from this extreme economical hit. But the condition of MFIs is not good as well. They are facing liquidity crisis and recovery issues simultaneously. The researcher indicates some suggestions on these issue like government incentives, efficiency in management levels to recover due loan with affection for the clients, decentralization in management levels, cutting down administrative costs, flexibility in regulations for opening a new firm who can distribute small loan, etc. The researcher also assesses the present circumstances of MFIs by analyzing the previous financial trend of MFIs. By analyzing these data, the researcher has decided that microfinance can play a vital role to recuperate the economy of Bangladesh from this present pandemic hit by deciphering some problems related to these firms.

- by Shoun Sarker
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- Finance, Economics, Development Economics, Microfinance
- by Sandeep Mahajan and +2
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- Development Economics, Economic Geography, Macroeconomics, Political Economy

Purpose: The purpose of this paper was to identifying the loan default rate and its impact on profitability, and
determining ways of reducing loan defaults in microfinance institutions.
Design/methodology/approach: The study adopted both qualitative (case study) and quantitative methods
respectively. Financial institutions were selected to gather data, which was acquired from answers obtained from
our administered questionnaire and also through interviews. The population of the survey constituted the
management and non-management staff and customers of First Allied savings and loans limited, Eden
Microfinance and Opportunity International savings and loans Limited.
Findings: Hypotheses of the study will be analyzed using correlation and regression. Results of the study show
that there are high positive correlation between the constructs of loan default rate and profitability of the various
microfinance institutions.
Keywords: Loan default rate, profitability, microfinance institutions

- by Evans Brako Ntiamoah
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- Financial Institutions and Markets, Profitability, Loan Default
- by Claudia Goldin
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- Education, Social Work, Educational Measurement, Adolescent

Default by corporate is problem of concern for banking and financial services industry along with economy. Timely prediction of default is imperative for the bankers and regulators to devise and take preventive actions. There has been large numbers of studies across the world and in India too few studies conducted for Indian data. An extensive review of literature reveals that the subject of default prediction has not explored much in India. In India along with rest of the world, the numbers of defaults have been increasing every year. This creates scope for further studies.
A comparative study has been conducted on the data of three countries, namely India, the US and the UK using four methods; MDA, logit, reduced form and structural models. The study for the Indian sample has developed 24 models for three methods; MDA, logit and reduced form model for two sample periods large sample period and small sample period on a sample of 2450 case over ten years from 1st April 2004 to 31st March 2014 and on two years data from 1st April 2014 to 31st March 2016, the developed models have been validated for the forward period as well as for the out of sample firms. Structural model has been tested on Indian data. The study for the American sample has developed three models for the three methods; MDA, logit and reduced form model. Structural model has been tested on American data. The study for the British sample has developed three models for the three methods; MDA, logit and reduced form model. Structural model has been tested on British data. So in this study total 30 models have been developed.
The study uses multiple discriminant analysis and logistic regression analysis to calculate composite scores which are used to predict default. The structural model uses option mathematics to give probability of default with help of market value of assets, book value of debt and asset drift rate. Reduced form model uses Poisson regression to estimate intensity of default which is transformed into probability of default.
The findings of the study for Indian sample suggest that logit model yields the highest classification accuracy of 97.7% and reduced form model yields the lowest classification accuracy of 82.3%. The models for small sample period are robust but classification accuracies for the models for large sample period are higher for different methods. The classification accuracies of 24 developed models for Indian sample has higher than many studies conducted in India and other countries. The findings of the study on American sample suggest that logit model yields the highest classification accuracy of 95% and structural model yields the lowest classification accuracy of 85.9% and classification accuracies of developed models higher than many studies. The findings of the study on British sample suggest that structural model yields the highest classification accuracy of 81.6% and reduced form model yields the lowest classification accuracy of 67.9%.
The findings on variables suggest that all the three types of variables namely accounting, market and economic variables are significant for all the three samples from India, the US and the UK. In case of India, it is observed that all the variables which are significant for large sample period are significant for small sample period indicating the in long run firms tend to follow a certain pattern and default can be predicted with the help of a set of certain variables as far as default predict is concerned. However in short run market variables seem play minor role in default prediction. From the analysis of variables it is evident that total book value of debt with respect to total assets is the most important variable among all the variables with debt component. The biggest limitation of this study is that the models for small sample period are more robust while the models for large sample period have higher classification accuracy. The whole study is facing the problem of sample and selection biases.

Small scale enterprises are an income stream for the unemployed and under-employed in Sierra Leone. The financing of such a venture is from the loan capital of Micro Finance Institutions and other credit agencies in the country. Default in the repayment of loan capital within prescribed conditions has been an issue because of the unethical practices of lenders and borrowers and hence concern for studies. The primary objective of the study is to do a review on the unethical business practices that causes loan default in small-scale enterprises in Port Loko municipality in Sierra Leone. Such studies will avail recommendations that shall be instruments to minimize the rate of unethical practices of borrowers and lenders within the Pot Loko Municipality. The Specific objectives of the study are to know the attitudes of Lenders and borrowers that influence loan default. Questionnaires were administered to respond to Researched Questions which were framed from the research objectives. Also, Reviews of others writers were done with regard ethical issues. The researcher Used the Likert Scale in preparing and administering the questionnaire. Opinions of Respondents were analyzed using the Structured Package for Social Sciences. The following analyses were done: i) Percentage Analysis, ii) Analysis of correlation by use of the Pearson Correlation. iii). Analysis of coefficient iv) Analysis of Model summary v) Analysis of Anova. From the study, the Researcher discovered that Unethical business practices like bribe-taking and other dishonest games are predominant between lenders and borrowers, and these practices have greatly influenced loan default in small-scale enterprises in Port |Loko Municipality in Sierra Leone and have a significant relationship on loan default.

- by Texila International Journal
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- Management, Loan Default, Small Scale Businesses
- by Amy Rathbun
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- Poverty, Early Childhood Education, Elementary Education, Income
- by Richard Fossey
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- Higher Education, Student Financial Aid, Loan Default, Student

This study analysed the relationship between credit risk and bank financial performance of selected commercial banks in Ghana for the period 2010-2014, using the banks respective financial statements. The study employed the quantitative research approach. The sample was Ghana Commercial Bank Limited, Zenith Bank Limited, UT Bank and Ecobank Plc. These four banks were selected using stratified random sampling technique. The data were primarily secondary and quantitative in nature. Both descriptive and inferential statistics were used to analyse the data. When the banks were compared, Ghana Commercial Bank Limited was found to be more liquid than Zenith Bank Limited. That of Zenith bank was also higher than UT bank and Ecobank Plc .However, profitability indicators showed that Zenith Bank Limited and Ecobank Plc utilised its assets better than Ghana Commercial Bank Limited and UT bank resulting in the two banks higher scores over the period. The findings show further that Ghana Commercial Bank Limited showed higher ratios for investment in the future while Zenith Bank Limited showed higher ratios of higher dividend immediately. However, Zenith Bank Limited capital adequacy level was far higher than the legal requirement of Banking sector while its counterparts fell slightly below it in terms of average. Based on the main findings and conclusions, it is recommended that Ghana Commercial Bank Limited should find a means of reducing its expenditure, introducing prudent assets management, should be cautious when assisting government in time of economic difficulty, and operate as an independent entity.

- by FOREX Publication
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- Credit Risk, Loan Default, Banking and Finance

The article provides a comprehensive review regarding the theoretical approaches, methodologies and empirical researches of corporate bankruptcy prediction, laying emphasis on the 30-year development history of Hungarian empirical results. In ex-socialist countries corporate bankruptcy prediction became possible more than 20 years later compared to the western countries, however, based on the historical development of corporate bankruptcy prediction after the political system change it can be argued that it has already caught up to the level of international best practice. Throughout the development history of Hungarian bankruptcy prediction, it can be tracked how the initial, small, cross-sectional sample and classic methodology-based bankruptcy prediction has evolved to today's corporate rating systems meeting the requirements of the dynamic, through-the-cycle economic capital calculation models. Contemporary methodological development is characterized by the domination of artificial intelligence, data mining, machine learning, and hybrid modelling. On the basis of empirical results, the article draws several normative proposals how to assemble a bankruptcy prediction database and select the right classification method(s) to accomplish efficient corporate bankruptcy prediction.

- by Tamás Kristóf and +1
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- Financial Distress, Corporate Failure, Credit Risk Modeling, Loan Default
- by Richard Portes
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- Economic History, Economic policy, World War II, Public sector
- by Sandy Baum
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- Higher Education, Student Financial Aid, Loan Default

- by Ellis K Akwaa-Sekyi
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- Business, Loan, Loan Default, Banking and Finance

This paper tests the presence of insider trading during the Ottoman sovereign default by analysing prices of Ottoman General Debt Bond traded in İstanbul, London, and Paris, which were the markets with the highest transaction volume of the bond. Data cover the period from 1875 to 1885 and are manually collected from newspapers—the Times, Basiret, Ceride-i Havadis, and Vakit—. To identify the insider trading activity prior to the Ottoman sovereign default claimed by the historical narratives, the paper uses Ljung-Box, Runs and Lo-MacKinlay tests in addition to accounting for endogenously determined structural breaks via Bai and Perron test. The results of this paper do not indicate abnormal returns and insider trading during the Ottoman sovereign default announcement.

An agricultural loan is an essential tool for transforming commercial agriculture into a profitable venture. In view of this, this study investigated determinants of access to agricultural loans and the profitability of small-scale cassava processing. It also tested whether access to agricultural loans affected the net farm income of cassava processors in Oyo State using budgetary analysis, endogenous switching regression model (ESRM) and augmented inverse probability weighted regression adjustment (AIPWRA) as a robustness check. A multistage random sampling procedure was employed to gather information from 120 cassava processors. The results revealed that female processors dominated cassava processing, and processors had a mean age of 41.1±7.5 years. Only 23% of the respondents had agricultural loan access, which was primarily sourced informally. Budgetary analysis showed that processors earned an average net farm income of N10,449.87 (US$29.03) in a production cycle. Endogenous switching regression analysis revealed that married and educated cassava processors that were socially inclusive and that had a large processing unit and earned meagre offfarm income were more likely to access agricultural loans. Furthermore, education (β=0.019, p<0.1), number of family members working (β=0.241, p<0.01), processors' experience (β=0.028, p<0.05) and enterprise size (β=0.001, p<0.01) influenced the net farm income of processors that had access to agricultural loans. The treatment effect from the AIPWRA result revealed that ATT and POM for cassava processing were 4.5% and 37%, respectively. Business risks, small enterprise size and high interest rate were the major constraints to agricultural loan access. From the foregoing, a need for a technical support system among cassava processors is inevitable. More so, cassava processors should be encouraged to join trade associations, and young processors should be given priority in credit initiatives for cassava processing.

- by Olabisi D . OMODARA (Ph.D.) and +1
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- Loan Default, Nonperforming Loans in Banks

El 23 de diciembre de 2001 el entonces presidente Rodríguez Saá declaró que el país entraba en default. El gobierno de Néstor Kircher, que comenzaba su mandato allá por el 2003, tuvo el enorme desafió político, económico y social de sacar a la Argentina de su declive. Lo que se aborda aquí es el establecimiento de cuáles fueron las estrategias tomadas por el gobierno kirchnerista para sacar a la Argentina del default y cómo pudieron estas acercar al país a la obtención de autonomía en un nuevo contexto mundial.

- by Carla Bisoglio
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- Argentina, Autonomia, Loan Default, Politica Exterior

The paper studies the default probabilities of the 47 Indian firms over period of 2007 to 2013. This study uses options based method to predict the probability of default of these firms over the assessment period. We has used Black, Scholes and Merton model in this paper. The study estimates the market value of assets, asset volatility, risk neutral default probability and real default probability of firms and finds out the factors that have impact on the default probabilities.

- by Dr Rajeev K . Upadhyay
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- Futures and Options, Default, Loan Default
- by Alisa Cunningham
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- Higher Education, Interviews, Loan Default

SMEs have been recognized as an important engine for driving economic growth and job creation both in the developed and developing countries. However, there is a concern that financial constraint is impeding growth in these SMEs. Bank is a major source of SME financing in most countries. In Malaysia, banks provide 90% of total financing to SMEs (SME Annual Report, 2014/15). Focusing on three aspects: the macroeconomic environment, demand for large enterprise loans and property prices, this study makes the initial attempt to discern the effect of these three factors on banks' willingness to lend to SMEs and also identify the most dominant factor taking Malaysia as a case study. Using the ARDL and Granger-causality approaches applied to Malaysian quarterly data for the period from 2003Q2 to 2015Q4, the study finds macroeconomic environment to be the most dominant factor influencing banks' willingness to lend to SMEs. The finding that property prices also play a role in influencing banks' willingness to lend to SMEs appears to suggest banks' dependency on property as collateral for SME financing. Thus, policy makers should continue to develop and improve SME financing schemes that encourage banks' participation in financing SMEs which have potential but lack collaterals.

- by Azarahiah Lokman
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- Islamic Banking, Islamic Finance, Credit Risk, SME Financing
- by Nicholas Hillman
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- Student Financial Aid, Loan Default

Sixty percent of Americans borrow student loans. More than $100 billion of student debt is delinquent or defaulted. Defaults can have life-altering negative impacts for borrowers, including delaying marriage and home-buying,and diminishing mental health. Research has pointed to several factors as influencing student loan default, including satisfaction with educational outcomes. Using an exchange theory approach, this research examines the impact of student satisfaction on the likelihood of default. Data from the U.S. Department of Education was used. According to the results of logistic regression, Satisfaction with education and outcomes has a statistically significant impact on likelihood of default.

- by Jennifer S K Dudley
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- Satisfaction, Quality of Education, Student Loan Debt, Loan Default

Introducción La probabilidad de default de un cliente o de un contrato se puede estimar usando un modelo econométrico de scoring. En estos modelos la variable dependiente puede tomar los valores 0 para No default, y 1 cuando el cliente o el contrato han entrado en default. Las variables explicativas son diversas, pueden ser continuas o discretas, y sirven para describir algún aspecto cuantitativo o cualitativo vinculado con la persona, contrato o cliente cuya probabilidad de default queremos explicar. Los modelos adecuados para estimar relaciones con variable dependiente binaria son el Modelo Logit y Modelo Probit. Es decir que, en estos casos, el modelo de probabilidad lineal tradicional (mínimos cuadrados ordinarios) no es el óptimo por las razones descriptas más adelante. En este trabajo estimamos empíricamente la probabilidad de default y los efectos marginales de las variables regresoras por los métodos descriptos anteriormente considerando N=1000 observaciones correspondientes a una base de datos de clientes (personas) de un banco alemán.

Bad Credit-Your credit history is a record of all past financial commitments and your pattern of repayment, as well as an overall look at your total debt load. Credit reference agencies use this information to assess your credit worthiness and assign a credit score. Lenders then use the credit score as a factor in deciding whether or not to underwrite your loan. How to get bad credit loans.

- by sumaiya soma
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- Student Loans, Bad Credit Loans, Loan Default, Personal Loan

This study assesses the classification accuracies of two statistical methods namely, multiple discriminant analysis and logistic regression approach in default prediction. It uses a small sample of 32 India firms listed on Bombay Stock Exchange for the sample period of six years over 2010-11 to 2015-16. Two models have been built using the two statistical methods. Results of the study clearly indicate that there are no significant differences in the classification accuracies because of change in statistical methods. Different statistical measures clearly suggest that the two developed models have comparative classification accuracies in default prediction. However, the specification and robustness of logit model is found to be on lower side than that of the discriminant model contrary to large numbers of studies. The weaker model specification of logistic model may be result of small sample size.

The initiation, funding, servicing and monitoring of loans by financial intermediaries has been done without regard to some critical factors which could have averted the likelihood of default. The study aimed at measuring the extent that owner-specific, borrower-specific, loan and lender-specific characteristics could determine the probability of loan default. The study used logistic regression for 224 business customers of a bank in Ghana from its nationwide branches. The study found that owner's extra income (ownership characteristics), multiple borrowing, diversion of loan purpose (borrower characteristics), loan price, loan purpose, loan age, repayment plan (loan characteristics) and underfunding (lender characteristics) significantly determined the probability of business loan default. The overall model predicted up to 78.5% of variations in the likelihood of default. The hierarchy of strong determinants given by their odd ratios were loan purpose (47.9 times), underfunding (19.2 times), diversion of loan purpose (11.7 times) multiple borrowing (9.4 times) and owner's extra income (8.2 times). The study can conclude that financial intermediaries should be wary of the credit granting process taking cognisance of ownership, borrower, loan and lender characteristics especially the significant predictors. Combining quantitative and qualitative variables as determinants of default could be considered in future.

- by Ellis K Akwaa-Sekyi
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- Loan Default

Microfinance institutions have been extending loans to different deficit units in Ghana and this study aimed at addressing the following issues: identifying the causes of loan default and the processes involved in granting loan by Microfinance institutions in Ghana. The convenient and purposive sampling techniques were employed to select respondents to provide answers to questionnaires. The population of the survey constituted the management and non-management staff and customers of some selected microfinance institutions in Ghana. Hypotheses of the study will be analyzed using correlation and regression. Results of the study show that there are high positive correlation between the constructs of loan default causes and how loans are granted. Keywords: Loan Default Rate, Monitoring and Repayment, Microfinance institutions.

- by Beatrice Opoku
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- Economics, Monitoring And Evaluation, Microfinance, Microfinance Institutions
- by Laura Perna
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- Poverty, Graduation, Comparative Analysis, Loan Default
- by Sandy Baum
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- Higher Education, Loan Default
- by sanjoy das
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- Prediction, Neural Network, Fuzzy Inference, Genetic Algorithm

Structural models of credit risk that seek a relationship between default probability and equity prices have been in use for some time. The model’s output is a measure referred to as distance-to-default (DD) which can be viewed as z-score of the firm’s value from its default barrier level. We utilize a barrier option approach to calculate DD for individual firms. Using recent historical defaults as reported by S&P, we calibrate a relationship between DD and expected default probability (EDP). We extend such a framework to determine a fair market price of credit, or as a tool to construct credit portfolios with optimal risk/return characteristics. The default probability can be used as a credit ranking tool that feeds off observable parameters, and more frequently updated market data such as equity prices. In addition, the simplicity and transparency of the approach makes it an ideal candidate to perform risk management and analysis of large portfolios of credit exposures. The computational efficiency of such an approach would allow a large portfolio to be recalculated daily and allow the computation of value-at-risk and stress tests. We establish some evidence that DD/EDP: 1) is a useful complement to traditional credit analysis, 2) has predictive power, 3) can be used for relative valuation and the pair-wise comparison, 4) is useful in optimizing portfolios of credit for return and volatility characteristics, 5) can be used for collateralized debt obligation (CDO) tranche sizing, and 6) can be used for delta hedging of individual tranches of CDOs.

- by Kishore Yalamanchili and +1
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- Risk Management and Insurance, Quantitative Research, Quantitative Methods, Investment analysis and valuation

- by Ron D'Vari
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- Business, Risk Management and Insurance, Quantitative Research, Quantitative Methods

- by Dr Rajeev K . Upadhyay
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- Futures and Options, Default, Loan Default

- by yusif arthur
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- Business, Business Management, Credit Risk, Loan Default

Educational Loan is an alternative of financial aids that is provided by the study funding agencies of Malaysia to reduce the economic burden of students in order to finance their studies at tertiary education level. Despite the increasing number of students who obtaining these educational loans, the issue of default in loan repayment among borrowers merely needs research attention. Thus this study aims to investigate the factors of study loan default among Malaysia tertiary graduates. Among the factors examined are family income, employment status and loan amount while respondents’ age, gender, marital status and education level are controlled. Questionnaires were distributed to 430 Universiti Teknologi MARA, Johor, Malaysia graduated respondents via online and 209 were returned The result of this study revealed that the employment status, loan amount and education level are significant to study loan default among Malaysian tertiary graduates. The results could serve some highlight...

- by AIDA ISMAIL
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- Financial, Loan Default

Delinquency: The Untold Story of Student Loan Borrowing the institute for higher education policy (ihep) is an independent, nonprofit organization that is dedicated to access and success in postsecondary education around the world. Established in 1993, the Washington, D.C.-based organization uses unique research and innovative programs to inform key decision makers who shape public policy and support economic and social development. IHEP's Web site, www.ihep.org, features an expansive collection of higher education information available free of charge and provides access to some of the most respected professionals in the fields of public policy and research. Acknowledgments The authors would like to thank the Institute for Higher Education Policy (IHEP) staff and senior associates who contributed to this We appreciate the feedback and advice provided by all participants at the roundtable discussion held December 2010 in Washington, D.C. In addition, we benefited from suggestions...

- by Alisa Cunningham
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- Business, Higher Education, Interviews, Loan Default
- by Adrian ziderman
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- Business, Economics, Higher Education, Taxes
- by Alberto Cabrera
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- Higher Education, Education Systems, Comparative Analysis, Income
- by Prakhar Jain
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- Loan Default, PESA, Gram Sabha, Bharat Jan Aandolan

Mostly, loans are important source of income for banks and capital is used to absorb shocks during a bank's worst periods. Credit risk is a major concern for the banking industry as the ratio of bad loans increases. The purpose of this research examines the effect of bank capital on lending growth with moderation of asset quality of banking sector listed in Indonesia Stock Exchange (IDX). This study used Fixed Effect Model. Data obtained from the company's financial report published in 2009-2018 period. Dependent variable in this research is lending growth proxied with Net Loan Growth. Independent variable used bank capital proxied with Capital Adequacy Ratio (CAR). Moderating Variable in this research used asset quality proxied with Non Performing Loan (NPL). In addition, controlling variable in this study are liquidity level, firm size and bank performance. The results showed that bank capital has a significant positive effect on lending growth, while the bad asset quality mitigates the positive effect of bank capital on lending growth. This results are in line with policies that have been made by Otoritas Jasa Keuangan (OJK) about maintaning capital adequacy ratio and non performing loan.