The purpose of this study is to find the relationship between lending to Small and Medium-size Exporter Enterprises (E-SMEs) and the use of Basel II Capital Accord for the first time in the banking system of Iran. Results showed that 96.69 percent of small firms were in the very low risk category of credit portfolio. This proof explains a consistent and balanced relationship between risk- weigh...

It is well established that equity issuance for most non-financial firms is procyclical. This paper shows that, in contrast, equity issuance for banks is countercyclical across credit cycles after 1980, as is retained income. Thus, during credit booms, banks raise less equity, even though more equity might help banks better absorb shocks. This paper shows that government guarantees play a cruci...

Do commercial banks invest less in information gathering activity when they compete more aggressively with each other? Does intensifying competitive pressure in bank loan markets affect the quality of informational ties that bind borrowers and lending banks? Using survey data from German manufacturing firms, we are able to directly measure information flows from loan applicants to banks. We fin...

Over the last three decades, advances in information technology have improved banks’ efficiency of credit scoring/rating. I infer that the technology of credit rating improves by 45% from 1990 to 2007. I evaluate the effects of this technological improvement on the US commercial banking market with a dynamic, quantitative model. In the model, banks have an economy of scale at utilizing new tech...

Before granting new credits, banks must gather qualitative and quantitative information about their prospective customers in order to start a rating process which allows them to assess the credit requestor’s risk class. Driven by intense structural changes within the financial industry and as a result of the specifications of the Basle II accord with regard to the rating process, banks are curr...

This paper examines the effects of tying microenterprise credit cooperatives (or “village banks”), with health and education services, using data from two Latin American countries, Ecuador and Honduras. Credit constraints particularly affect women (microentrepreneur) borrowers. Evidence suggests that mothers’ income increases are more likely to be spent on nutrition and other health improving e...

In a general equilibrium model we examine the optimal allocation of equity and debt across banks and industrial rms when both are plagued by incentive problems and rms can borrow from banks. Increasing bank equity mitigates bank-level moral hazard but may exacerbate rm-level moral hazard due to dilution of rm equity. Competition of banks will not result in a socially e cient level of equity. Im...

Credit relationships between commercial banks and quoted firms are studied for the structure and its temporal change from the year 1980 to 2005. At each year, the credit network is regarded as a weighted bipartite graph where edges correspond to the relationships and weights refer to the amounts of loans. Reduction in the supply of credit affects firms as debtor, and failure of a firm influence...

decision trees as one of the data mining techniques, is used in credit scoring of bank customers. the main problem is the construction of decision trees in that they can classify customers optimally. this paper proposes an appropriate model based on genetic algorithm for credit scoring of banks customers in order to offer credit facilities to each class. genetic algorithm can help in credit sco...