This article examines the relationship between a mortgage originator's affiliation with the sponsor of a securitization or the servicer of the securitized loans and the default rate on the securitized mortgages. We find that default rates are significantly lower for securitizations in which the...

This article examines the relationship between a mortgage originator's affiliation with the sponsor of a securitization or the servicer of the securitized loans and the default rate on the securitized mortgages. We find that default rates are significantly lower for securitizations in which the...

This article examines the determinants of the mix of private and public debt using detailed information on the debt structure of 250 publicly traded corporations from 1980 through 1990. The authors find that the relationship between bank borrowing and the importance of growth opportunities...

This paper describes the RAROC system developed at Bank of America (B of A) in order to examine how risk-based capital allocation models work. I begin by discussing the economic rational for allocating capital in a diversified organization like the B of A. Drawing on recent work by Froot and...

This article examines the conditions under which bank lenders make concessions by taking equity in financially distressed firms. I show that the role banks play in debt restructurings depends on the financial condition of the firm, the existence of public debt in the firm's capital structure and...