lending, borrower quality and collateral as a key variable in loan contract design. We used a unique data set based on the … examination of credit files of five leading German banks, thus relying on information actually used in the process of bank credit … decision-making and contract design. In particular, bank internal borrower ratings serve to evaluate borrower quality, and the …

distress. Relative to outside loans in distress, relationship loans in distress have lower maturity. The fraction of bank …

borrowers will default on terms of debt, subsequently putting the capital of a bank in jeopardy. This concern has resulted in … institutions. Kenyan banks, like other financial institutions elsewhere, face the same problem and rely heavily on collateral … lending which is a traditional instrument of providing security against loan advances. Although collateral lending gives …