Although psychometric features have been considered for alternative credit scoring, they have not yet been applied to peer-to-peer (P2P) lending because such information is not available on platforms. This study proposed an alternative credit scoring model for P2P lending by extracting typical...

We document a significant relationship between subprime auto credit and road safety, with a one-standard-deviation increase in originations of such loans in a county being associated with a 5 percent increase in fatal crashes. The results are robust at various geographical levels and hold for...

The purpose of this paper was to investigate the determinants of risk-taking in the context of Islamic and conventional microfinance institutions (MFIs) while considering the capital structure’s role in moderating the risk-taking decisions’ effect on financial performance. Fixed and Random...

Academic research on loan loss provisioning and the earlier incurred credit losses (ICL) model has a long tradition in the literature. Academic criticism of the ICL was taken up by the Financial Stability Board after the financial crisis of 2018, leading to a fundamental revision of accounting...

We build a textual score measuring the tone of bank earnings press release documents. We use this measure to define bank manager sentiment as the variation in the textual tone score which is orthogonal to bank-specific and macroeconomic fundamentals. Using this definition of sentiment, we...

A string of theoretical papers shows that the non-exclusivity of credit contracts generates important negative contractual externalities. Employing a unique dataset, we identify how these externalities affect the supply of credit. Using internal information on a creditor's willingness to lend,...

In the recent theoretical literature on lending risk, the coordination problem in multi-creditor relationships have been analyzed extensively. We address this topic empirically, relying on a unique panel data set that includes detailed credit-file information on distressed lending relationships...

This paper explores the implications of systemic risk in Credit Structured Finance (CSF). Risk measurement issues loomed large during the 2007-08 financial crisis, as the massive, unprecedented number of downgrades of AAA senior bond tranches inflicted severe losses on banks, calling into...

This paper explores the implications of systemic risk in Credit Structured Finance (CSF). Risk measurement issues loomed large during the 2007-08 financial crisis, as the massive, unprecedented number of downgrades of AAA senior bond tranches inflicted severe losses on banks, calling into...

The recent problems in the financial sector suggest that various types of loans present different types of risk over and above the normal charge-offs. This paper examines the risk associated with post-merger variability in the charge-off rate and the non-performing loan rate, and the...