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Many entrepreneurs who close a business are actually willing to venture anew. However, to realize a restart is not only a matter of willingness on the part of the entrepreneur but also of its feasibility. Regarding the feasibility of a restart, the aspect of capital acquisition might be...
Persistent link: https://www.econbiz.de/10010298670
In this paper we stress-test credit portfolios of 28 German banks based on a Mertontype multi-factor credit risk model. The ad-hoc stress scenario is an economic downturn in the automobile industry that constitutes an exceptional but plausible event suggested by historical data. Rather than on a...
Persistent link: https://www.econbiz.de/10010298778
Generally, information provision and certification have been identified as the major economic functions of rating agencies. This paper analyzes whether the watchlist (rating review) instrument has extended the agencies' role towards a monitoring position, as proposed by Boot, Milbourn, and...
Persistent link: https://www.econbiz.de/10010298930
Credit rating agencies do not only disclose simple ratings but announce watchlists (rating reviews) and outlooks as well. This paper analyzes the economic function underlying the review procedure. Using Moody's rating data between 1982 and 2004, we find that for borrowers of high...
Persistent link: https://www.econbiz.de/10010299004
Do private banks act as hard-nosed bankers when firms get financially distressed compared to public banks that have the mandate to support regional economy? For German firms in the period 2000-2005, I find that the probability of leaving the market after financial distress is higher for firms...
Persistent link: https://www.econbiz.de/10010299467
Credit risk measurement and management become more important in all financial institutions in the light of the current financial crisis and the global recession. This particularly applies to most of the complex structured financing forms whose risk cannot be quantified with com-mon rating...
Persistent link: https://www.econbiz.de/10010299985
The paper analyses options in case of insolvency. Although insolvency plans empirically are very successful, they are not used very much. Reasons that prevent their application and possibilities for their promotion are discussed.
Persistent link: https://www.econbiz.de/10010300002
Zahlungs- und Schuldendeckungsfähigkeit stellen finanzwirtschaftliche Existenzbedingungen dar, deren Einhaltung in Bankenkrisen gefährdet ist. Das war nicht anders in den Bankenkri-sen der National Banking-Ära der USA. Fraglich ist, ob mit der Einführung des Federal Re-serve Systems eine...
Persistent link: https://www.econbiz.de/10010300264
Liquidity and solvency are conditional for banks' existence, They are endangered during banking crises. Since the banking crises of the National Banking Era in the USA are no exceptions, the question remains whether the foundation of the Federal Reserve System offered an adequate solution to the...
Persistent link: https://www.econbiz.de/10010300280
This paper explores how different reasons for business closure impact the probability that financial loss will be suffered by creditors. Using German small business data, the study finds that business closure due to financial problems is strongly correlated with a likelihood of financial loss....
Persistent link: https://www.econbiz.de/10010300384