The pricing problem of credit derivatives has received much attention in the last decade. An important unresolved problem, however, is the pricing of credit derivatives under the general environment in which the interest rate process and the hazard rate process are stochastic. This article addresses the pricing problems of credit derivatives (defaultable bonds, default swaps, and default option...

Trade credit is a well established promotional tool in the present competitive world and its impact on demand cannot be ignored. Businesses often use trade credit to increase their market share and, in turn, the profit. Undoubtedly, trade credit plays a great role in increasing the demand but it also involves a great risk of nonpayment. In order to reduce the risk of non-payment, businessman at...

This paper provides evidence that as a result of poor mobility of capital within India, regional wealth constrains the growth of regional manufacturing. It shows that capital market imperfections can help explain the uneven pattern of industrial growth across regions in India. I exploit a policy-induced exogenous increase in the supply of credit to an identifiable set of factories in 1998 to de...

A positive corporate reputation is generally taken to be a valuable resource leading to competitive advantage. In this paper we examine the association between a firm's media reputation and the amount of trade credit given in a sample of listed UK firms. Consistent with expectations, our results show that a firm's willingness to extend trade credit to its customers is inversely related to its m...

Credit markets play an important role in the macroeconomy and credit market data is often used to predict both future macroeconomic and stock market performance. In this paper we propose a tractable general equilibrium asset pricing model with heterogeneous firms that links movements in stock and bond markets to macroeconomic activity. The model suggests that movements in risk premia in corpora...

This study evaluated micro-credit programmes of six leading NGOs/MFIs (BRAC, Grameen Bank, PROSHIKA, ASA, SSS and TMSS) in terms of the clients’ views towards the programmes. The objective of this project is to develop a selection criterion to identify the efficient programme. A total of 406 members from the selected NGOs/MFIs operating micro-credit programmes in Dhaka, Mymensingh, Sherpur, Net...

In practice, in order to reduce default risks with credit-risk customers, a seller (e.g., a manufacturer or a retailer) frequently requests its credit-risk customers to pay a fraction of the purchase amount at the time of placing an order as collateral deposit, and then grants a permissible delay on the outstanding balance (i.e., a down-stream partial trade credit). By contrast, the seller usua...

In this paper, we present the macro stress test with a credit risk approach for banking system of Iran during the period 2004Q1-2019Q4. The goal is to evaluate the vulnerability of the banking system through credit risk to the country economic shocks. In this regard, the developed method of Wilson (1997) Credit Portfolio View model including macroeconomic variables and default rate has been use...