bank credit reallocation with endogenous firm entry and exit that allows for both theoretical and quantitative analysis. By … also redirect existing credit to more productive entrants. This reduces banks’ dependence on household deposits that are …

bank credit reallocation with endogenous firm entry and exit that allows for both theoretical and quantitative analysis. By … also redirect existing credit to more productive entrants. This reduces banks' dependence on household deposits that are …

institutional feature of the Italian credit market that generates a sharp discontinuity in the allocation of comparable firms into … credit risk categories. Using loan-level data, we show that during the expansionary phase of the cycle, banks relax lending … the cycle, the abrupt tightening of lending standards leads to the exclusion of substandard firms from credit. These firms …

Estimating expected credit losses on banks' portfolios has long been difficult. The issue has become of increasing … develops a measure of the one-year-ahead expected rate of credit losses (ExpectedRCL) that combines various measures of credit … of expected credit losses. ExpectedRCL performs substantially better than net charge-offs in predicting one …

This study develops a timely and unbiased measure of expected credit losses. The expected rate of credit losses … (ExpectedRCL) is a linear combination of various non-discretionary credit risk-related measures disclosed by banks. ExpectedRCL … performs substantially better than net charge-offs, realized credit losses, and fair value of loans in predicting credit losses …

This paper studies whether credit ratings can alleviate the hold-up problem between small opaque firms and informed … expensive bank credit, especially from new and less informed lenders. Consequently, they rely less on the informationally … powerful lender and invest more. We conclude that credit ratings reduce the informational gap between lenders and erode the …

Estimating expected credit losses on banks' portfolios is difficult. The issue has become of increasing interest to …-year-ahead expected rate of credit losses (ExpectedRCL) that combines various measures of credit risk disclosed by banks. It uses cross …-sectional analyses to obtain coefficients for estimating each period's measure of expected credit losses. ExpectedRCL substantially …

of lenders not observing a borrower's true credit score but only seeing an aggregate credit category. We find that … borrower's credit score. This inference is economically significant and allows lenders to lend at a 140-basis-points lower rate … for borrowers with (unobserved to lenders) better credit scores within a credit category. While lenders infer the most …

Over the past decade, as a result of rapid growth of the loan portfolio and the financial crisis, importance of credit … process by various researchers and financial market participants. New regulations forced commercial banks to improve credit … value ratio, credit history and borrower's type (whether borrower receives income in that bank). Average prediction accuracy …