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How Public Information Affects Asymmetrically Informed Lenders : Evidence from a Credit Registry Reform

Choudhary, M. Ali; Jain, Anil - 2017

evaluate the importance of adverse selection in the credit market. A 2006 reform introduced by the State Bank of Pakistan (SBP … banks and adverse selection, which generates predictions on how this reform is expected to affect a bank's willingness to …. We construct a measure for the amount of information each lender has about a firm's group using the set of firm-bank …

Persistent link: https://www.econbiz.de/10014121071

The use of collateral in formal and informal lending : conference paper

Kislat, Carmen; Menkhoff, Lukas; Neuberger, Doris - 2013

The ex ante theory of collateral states that better informed lenders, such as informal lenders, rely less on collateral. We test this by contrasting the use of collateral between formal and informal lenders in the same market. Indeed, formal lenders rely more often on collateral, controlling for...

Persistent link: https://www.econbiz.de/10010342166

The banking firm : the role of signaling with collaterals

Bieta, Volker (contributor); Broll, Udo (contributor); … - 2008

In this paper we challenge basic results of signaling models. In our banking model each project of a borrower is described by a continuous density of outcomes. Different density functions are classified according to second stochastisch dominance. Combining these features we find that in a...

Persistent link: https://www.econbiz.de/10003796251

Syndicated Loans : The Role of Covenants in Mitigating Lender Disagreements

Dass, Nishant - 2015

We study the role of covenants in syndicated bank loans. We argue that, in addition to being a device for monitoring …) when the lead's loan allocation is greater and (iii) when participating bank affiliates hold substantial equity in the …

Persistent link: https://www.econbiz.de/10013038187

Adverse Selection and Credit Certificates : Evidence from a P2P Platform

Hu, Maggie - 2019

Certificates are widely used as a signaling mechanism to mitigate adverse selection when information is asymmetric. To reduce information asymmetry between lenders and borrowers, Chinese peer-to-peer (P2P) lending platforms encourage borrowers to obtain various kinds of credit certificates. As...

Persistent link: https://www.econbiz.de/10012861137