Models of public-private partnerships in megaprojects: the Spanish case

This article provides a literature review of PPP Models, where the clarification of this current confusion and ambiguity constitute the fundamental issue addressed by our research. The systematization of the PPP models is performed by applying six classification criteria based on organizational and financial aspects and focused on the Spanish experience. Additionally, a comparative study of the various schemes applied in European countries is carried out, whereby the concession model implemented successfully in Spain is studied in greater detail. To this end, a megaproject, the first metro line of Seville (Spain) forms the basis of a case-study. When the megaproject is viable through user fees, the public sector can use PPPs to defer payments and as a way to control their deficits and debt without cutting investments in infrastructures and public services. Nevertheless, certain drawbacks should be borne in mind, such as the expenditure commitments of future budgets, the higher cost of private funding, and the necessity for transparency and accountability of PPP contractual arrangements to be improved. Therefore, the aim of this article is to analyze the various forms of PPPs in megaprojects in order to determine the potential efficiency gains that can be achieved in the implementation of these models

Kernel alternatives to aproximate operational severity distribution: an empirical application

The estimation of severity loss distribution is one the main topic in operational risk estimation. Numerous parametric estimations have been suggested although very few work for both high frequency small losses and low frequency big losses. In this paper several estimation are explored. The good performance of the double transformation kernel estimation in the context of operational risk severity is worthy of a special mention. This method is based on the work of Bolancé and Guillén (2009), it was initially proposed in the context of the cost of claims insurance, and it means an advance in operational risk research

The financial performance of an innovative megaproject

The financial structure of megaprojects, known in the literature as project finance, is characterized by the creation of a legally independent project company financed with a concentrated equity ownership and a high level of non-recourse debt. Research in this field may yield new ideas and theories about the existing theoretical framework on capital structure, stakeholder management and risk management. A case-study is analyzed in this paper: the financial performance of the first metro line in Seville (Spain). In spite of previous cost overruns in the construction stage, the present operation stage is considered successful from the point of view of social and financial profitability, whereby the risks have been theoretically transferred to stakeholders, as defined by Value for Money considerations. The objective of this study involves: first to determine whether this megaproject meets the expectations for which it was created in terms of hope of return of the shareholders, and the expectations of the economic and financial feasibility under a change of subsidy policies; and secondly to determine whether the conditions remain for not including the investment as public debt. This issue is crucial in a budgetary constraint context for the planning of future metro lines. By taking this first experience into account, this article also provides information for potential participants in the projects of the new metro lines, which are currently in the planning stage

Improving bankruptcy prediction in micro-entities by using nonlinear effects and non-financial variables

The use of non-parametric methodologies, the introduction of non-financial variables, and the development of models geared towards the homogeneous characteristics of corporate sub-populations have recently experienced a surge of interest in the bankruptcy literature. However, no research on default prediction has yet focused on micro-entities (MEs), despite such firms’ importance in the global economy. This paper builds the first bankruptcy model especially designed for MEs by using a wide set of accounts from 1999 to 2008 and applying artificial neural networks (ANNs). Our findings show that ANNs outperform the traditional logistic regression (LR) models. In addition, we also report that, thanks to the introduction of non-financial predictors related to age, the delay in filing accounts, legal action by creditors to recover unpaid debts, and the ownership features of the company, the improvement with respect to the use of solely financial information is 3.6%, which is even higher than the improvement that involves the use of the best ANN (2.6%)

Hybrid model using logit and nonparametric methods for predicting micro-entity failure

Following the calls from literature on bankruptcy, a parsimonious hybrid bankruptcy model is developed in this paper by combining parametric and non-parametric approaches.To this end, the variables with the highest predictive power to detect bankruptcy are selected using logistic regression (LR). Subsequently, alternative non-parametric methods (Multilayer Perceptron, Rough Set, and Classification-Regression Trees) are applied, in turn, to firms classified as either “bankrupt” or “not bankrupt”. Our findings show that hybrid models, particularly those combining LR and Multilayer Perceptron, offer better accuracy performance and interpretability and converge faster than each method implemented in isolation. Moreover, the authors demonstrate that the introduction of non-financial and macroeconomic variables complement financial ratios for bankruptcy prediction

Análisis de los indicadores de perfomance de las instituciones microfinancieras: comparativa con las entidades financieras formales

Desde sus comienzos en los años 70 al día de hoy, podemos hablar del sector de las microfinanzas como un sector en crecimiento, pero ya consolidado por el gran número de instituciones especializadas en servicios microfinancieros y el resultado de sus prácticas exitosas. En el trabajo que presentamos realizamos un estudio preeliminar sobre los indicadores de performance de las Instituciones de Microfinanzas (IMFs). Nuestro objetivo es detectar las particularidades en los resultados de dichos parámetros y ratios en dichas instituciones. Para ello llevamos a cabo un análisis teórico de los ratios más aceptados por la comunidad financiera implicada en el suministro de información sobre los resultados y la performance de las IMFs. El estudio se completa comparando los datos suministrados por estas instituciones con los equivalentes en entidades financieras tradicionales de nuestro entorno, haciendo especial hincapié en la actividad de estas últimas entidades en Latinoamérica

Modelling self-sufficiency of microfinance institutions using logistic regression based on principal component analysis

Analizar los factores que influyen en la sostenibilidad es clave para llegar a alcanzarla. En base a la Teoría de los Recursos y las Capacidades (Grant, 1991), desarrollamos un modelo de gestión que determina los factores explicativos de la sostenibilidad de las instituciones microfinancieras (IMF). El modelo empírico se desarrolla aplicando análisis de componentes principales y regresión logística, sobre una muestra de 313 IMF, con 31 variables financieras agrupadas en seis componentes/factores que están teóricamente relacionadas con su autosuficiencia. Nuestros resultados muestran una relación significativa y positiva entre el tama˜no y la eficiencia-productividad de las IMF con su sostenibilidad, presentando el factor riesgo de crédito una relación inversa con respecto a dicha sostenibilidad. Por tanto, sugerimos que las IMF que quieran continuar desarrollando su actividad bajo un enfoque de autosuficiencia, deben fomentar una estrategia de gestión orientada hacia: (1) el aumento de la eficiencia-productividad, (2) el control exhaustivo del riesgo de crédito y (3) el incremento del tama˜no para la consecución de economías de escala. La capacidad predictiva del modelo es alta, con un área bajo la curva ROC (AUC) del 89.7%.The analysis of the factors that influence sustainability is the key to achieving it. Based on the Theory of Resources and Capabilities (Grant, 1991), a management model that determines the explanatory factors of the sustainability of microfinance institutions (MFI) is developed. The empirical model is constructed by applying a principal component and logistic regression analysis using a sample of 313 MFI, with 31 finance variables, grouped into 6 components/factors that are theoretically associated with selfsufficiency. The results obtained showed a significant and positive relationship between size and the efficiency-productivity of the MFI and their sustainability, with the credit risk factor having an inverse relationship as regards that sustainability. Thus, it may be suggested that the MFI that wish to continue developing their activity using a self-sufficiency approach must promote a management strategy oriented towards: (1) an increase in efficiency-productivity, (2) the exhaustive control of credit risk and, (3) the increase in size in order to achieve economies of scale. The predictive capacity of the model is high, with an area under the ROC curve of 89.7%

¿Deben utilizar las instituciones microfinancieras un credit scoring? Análisis del caso español

No existe consenso sobre la idoneidad de la implementación de los modelos de credit scoring para evaluar la solvencia del solicitante de un microcrédito. En este trabajo, se propone una metodología que permite decidir, a priori, en función del enfoque estratégico que tenga una Institución Microfi nanciera (IMF), si le sería útil o no dicha implementación. Para llevar a cabo la discriminación anterior, se ha diseñado una matriz que clasifi ca a las IMFs, según sus orientaciones estratégicas, en potenciales implantadoras de sistemas de credit scoring, o bien, en IMFs que no necesitan tales herramientas. Para realizar la investigación, hemos utilizado la metodología del caso, analizando tres IMFs españolas con perfi les diferentes a través de un cuestionario, recabando datos cuantitativos y cualitativos, al objeto de buscar evidencia empírica que corrobore el análisis teórico realizado.No consensus exists about the suitability of the implementation of credit scoring models for the assessment of the creditworthiness of a microcredit applicant. In this paper, a methodology is proposed in order to fi rst determine, depending on the strategic focus of the MFIs, whether this implementation would be useful. For this discrimination, a matrix is designed which classifi es the MFIs, according to their strategy, as potential or non-potential users of a credit-scoring system. To this end, a case-study methodology is employed which analyses three MFIs of widely diff ering profi les by means of a both quantitative and qualitative survey whose aim is to seek empirical evidence which verifi es the theoretical analysis performed

Predicting the intention to use Paytech services by Islamic banking users

Purpose – This study aims to identify the factors that could explain the intention to use Paytech services within an Islamic banking context. The authors use an extended version of the technology acceptance model to develop a causal–predictive analysis. Design/methodology/approach – The research model and hypotheses were tested by applying partial least square-structured equation modeling to data collected from 214 users of Islamic banking in Saudi Arabia. Findings – The results show that perceived trust has a highly significant direct effect on the intention to use Islamic Paytech services, whereas perceived risk has a significant indirect effect on IU. Research limitations/implications – Internet banking behavior may not be static. In technology acceptance, during the various phases from introduction to the maturity phase, the respondent’s perceptions tend to change Practical implications – From the point of view of Fintech services providers, the knowledge of the factors fostering the adoption of Fintech services would allow an international expansion without the inconvenience of establishing offices or companies in countries whose legislation does not favor the operations carried out by Islamic banks. Social implications – These digital payment services would allow access to financial services to the entire Muslim population regardless of their location (Islamic and non-Islamic nations) and will also reach out to the next generation of young Muslims as a majority are “digital natives”ready for digital Islamic financial solutions. Originality/value – This study is the first to explore the intention to use Paytech services by Islamic banking users in Saudi Arabia. From a theoretical perspective, this work contributes to the academic literature by analyzing the intention to use Paytech services in an Islamic banking context. On the practical front, the study identifies the crucial factors that industry players can use to design their Paytech applications and services to increase financial inclusion in Saudi Arabia and other countries with similar cultures as well as to design an international expansion without the inconvenience of establishing offices or companies in countries whose legislation does not favor the operations carried out by Islamic bank