Using a novel dataset that allows us to trace the primary bank relationships of a sample of mostly unlisted firms, we explore to what extent foreign banks can improve the allocation of credit in emerging markets. Our results suggest that the limits of financial integration are less tight than what the previous literature based on a static picture of bank loan portfolios suggested. Foreign banks...

Using a novel dataset that allows us to trace the primary bank relationships of a sample of mostly unlisted firms in Eastern Europe, we explore to what extent foreign banks can improve the allocation of credit. Our results suggest that the limits of financial integration are less tight than what previous literature based on a static picture of bank loan portfolios suggested. Foreign banks appea...

In a credit market with enforcement constraints, we study the effects of a change in the outside options of a potential defaulter on the terms of the credit contract, as well as on borrower payoffs. The results crucially depend on the allocation of “bargaining power” between the borrower and the lender. We prove that there is a crucial threshold of relative weights such that if the borrower has...

On December 14, 2001, the Payment Cards Center of the Federal Reserve Bank of Philadelphia held a workshop exploring retail credit risk modeling practices and evolving techniques. The workshop was led by Paul Calem, a senior economist at the Board of Governors, Division of Research and Statistics. Calem is currently involved in the Board's efforts supporting reforms to the international Basel C...

This article highlights the effects particular features of microfinance programs have on childhood education. Using data from a South India household survey, the article examines how microfinance impacts schooling and literacy, how credit enters the household, and who brings it in. Regression results show that, in the case of direct bank-borrower credit delivery, it does not matter whether cred...

Markowitz (1952, 1959) first proposed a well-known mean-variance analysis for optimizing portfolio diversification that has been long served as a foundation of modern finance. The risk diversification was formulated by a quadratic optimization model. Unfortunately, the quadratic optimization had a computational difficulty in dealing with a large number of asset allocations. To enhance the comp...

For credit risk management purposes in general, and for allocation of regulatory capital by banks in particular (Basel II), numerical assessments of creditworthiness are indispensable. These assessments are expressed in terms of probabilities of default (PD) that should incorporate a certain degree of conservatism in order to reflect the prudential risk management style banks are required to ap...

The existing literature on FinTech and green finance has primarily focused exploring sustainable economic environmental benefits. However, empirical research examining the effect of remains underexplored. In light advantageous position credit in development China, this study analyzes impact using polluting listed firms 2012–2021. results show that significantly improves credit, affecting it thr...