Usury is a frequent occurrence in consumer credit markets and particularly affects low-income households. Although the term usury conjures images of a greedy individual consciously acting to exploit the weak bargaining position of another by deceitful and even fraudulent means, we consider it as...

Have post-crisis reforms purged mortgage markets of adverse selection? I show that loans synthetically sold by Fannie Mae through Credit Risk Transfers are ex post riskier, controlling for observable quality, than those they keep on balance. Transfers that go unreported on public data are...

We employ a unique dataset of credit assessments for 3,756 small businesses by nine banks using an identical rating model to examine (i) to what extent loan officers use their discretion to smooth credit ratings of their clients, and (ii) to assess whether this use of discretion is driven by...

Trade credit plays a very important role in inter-firm transactions. Because formal contracts are often unavailable, it is granted within an ongoing relationship. We characterize the optimal self-enforcing contract, when the ability to repay is unknown to the supplier and the threat of trade...

This study examines the sources of credit risk associated with asset securitizations and whether credit rating agencies and the bond market differ in their assessment of this risk. Measuring credit risk using credit ratings, we find the securitizing firm's credit risk is positively related to...

This study assesses the interconnectedness of credit risk exposures in a tripartite network of cross-shareholdings among banks, insurers, and firms in Japan's stock market during the fiscal years 2008-2015. We use consistent measures: credit risk exposure by PD (probability of default)/LGD (loss...

We demonstrate theoretically and empirically the presence of forbearance lending by profit-maximizing banks to influential buyers in a supply network. If the financial market is concentrated, then banks can internalize the negative externality of an influential firm's exit. As a result, they may...

This study assesses the credit risk of Japan's real estate investment trusts (J-REITs) in two related markets during the fiscal years 2008--2017. The first J-REIT market involves blockholders, while the second is a lending market of institutions (i.e., banks and insurers). Unlike investment...

This study assesses the network structures of cross-shareholdings among listed Japanese companies using a dataset of 2,936 companies for fiscal years 2008-2015. First, we analyze the network structure of cross-shareholdings in the Japanese stock market using centrality measures. Financial...

During the transition period from a planned economy to a market economy in the 1990s of China, there was a considerable accrual of deferred payment, and default due to inferior enforcement institutions. This is a very common phenomenon in the transition economies at that time. The Chinese...