With the emergence of the current financial crisis, societies see the increasing importance of credit risks management in financial institutions. Four mainstream credit risk rating models have been developed, however, their applicability in the Taiwan market is yet to be evaluated. In this paper, six major credit risk models, including Merton Option Pricing Model,Discriminant Analysis Model, Lo...

This paper examines the effects of managerial overconfidence on bank risk taking and investigates whether improvements in governance can help to mitigate the adverse effects of managerial overconfidence on bank risk taking by using ordinary least squares method. The sample consists of the financial institutions in G20 and Taiwan over the period of 2005-2012. The executive overconfidence is meas...

The authors investigated the issues of assessing financial risks in mining industry, studied problems hedging conditions high uncertainty when a company enters foreign markets. importance SPIC document was determined as form interaction between enterprises and state, which allows more actively investing while reducing for investors. article outlines digitalization that allow managing risks, bas...

We consider a banking model in which firms’ access to credit is constrained due to the banks’ limited risk-bearing capacities. We show that such constraints may be relaxed by allowing banks to transfer risks to outside investors. However, the market for credit risk transfer (CRT) works smoothly only if loans are based on hard, i. e., verifiable information. In contrast, the market for CRT eithe...

In this paper, we examine differences in default risks for formal, informal and semi-formal loans and analyze the determinants of default risks regarding the three credit sources, using household data for Vietnam. We find that smaller-sized households with collateral and/or a guarantor borrow primarily from formal and semi-formal lenders whereas female contractors, large-sized households and bo...

Consumer credit risk analysis plays a significant role in stabilizing a bank’s investments and in maximizing its profits. As a large financial institution, Bank of America relies on effective risk analysis to minimize the net credit loss resulting from its credit products (e.g. mortgage and credit card loans). Due to the size and complexity of the data involved in risk analysis, risk analysts a...

In this paper we discuss the interaction of default risk and liquidity risk on pricing financial contracts. We show that two risks are almost indistinguishable if the underlying contract has non-negative values; however, if it can take both positive and negative values then these two risks demand different risk premiums depending on their loss rates and distributions. We discuss a structural de...

Thailand each have sought to generate economic recovery by expanding domestic credit.The rapid credit expansion in both countries has created concerns about the extent to which their economies can channel these funds efficiently and sustain economic growth. In particular, if banks are unable to supervise the allocation of resources effectively, there is a risk of widespread bankruptcies and a f...

In today’s technological age, fraud has become more complicated, and increasingly more difficult to detect, especially when it is collusive in nature. Different fraud surveys showed that the median loss from collusive fraud is much greater than fraud perpetrated by a single person. Despite its prevalence and potentially devastating effects, collusion is commonly overlooked as an organizational ...

This study empirically investigates how a bank's nonfinancial signals of environmental reputation affect its deposits and credit provision in US counties with severe climate transition risks. We find that banks higher reputational risks associated issues tend to experience declining exposed change Banks poor also reduce mortgage origination such diminish liquidity creation if they have high dep...