The asset-correlation parameter in Basel II for mortgages on single-family residences

Bank capital ; Risk management ; Basel capital accord ; Mortgages

An Estimation of Three Sets of indicators of Financial Risk Among Multifamily Properties

A lack of information about the financial condition of multifamily properties has hindered the development of a secondary mortgage market in multifamily mortgages and federal policies to finance multifamily housing. The purpose of this paper is to improve our understanding of the financial condition of multifamily properties. The centerpiece of the analysis is the 1991 RFS [U.S. Bureau of the Census]. Three sets of indicators of financial distress are examined in this paper. The first is interest rate related risk. We find that twenty five percent of the properties with mortgages have contract interest rates at least 87 basis points above the average contract rate, which was 10 percent at the time of the survey. This places these properties at a disadvantage in the market place because their costs are above average. On the positive side, many property owners were able to refinance or otherwise renegotiate their contract interest rates during periods of interest rate decline. The second is cash flow risk as measured by the ratio of net operating income to the mortgage payment (DCR). The measured DCR has a mean of 2.9 and a median of 1.36 among properties with a mortgage. A quarter of all properties with some mortgage debt have a DCR below unity. If one assumes our measure overstates the true DCR by 20 percent, then as many as half of the properties have DCRs at or below 1.1, which suggests that a large fraction of the multifamily stock suffers from cash flow problems. The third is risk due to low equity. Investors with little or negative equity in the property are more likely to default than are investors with a substantial equity stake in the property. Such risk is measured by the loan to value ratio (LTV). The average LTV is .43 among all properties; three quarters of all properties have at least one mortgage and the average LTV among properties with some debt is 55 percent. Higher than average LTVs are associated with several other property characteristics: properties owned by partnerships (LTVs about 5 percentage points higher than the omitted category); properties that receive some type of assistance, e.g., Section 8 (LTVs from 2 to 5 percentage points higher than non-assisted properties); and properties with ARMs, balloon mortgages, or multiple mortgages (LTVs about 6 or 7 percentage points higher than others)

Solum depth spatial prediction comparing conventional with knowledge-based digital soil mapping approaches

Solum depth and its spatial distribution play an important role in different types of environmental studies. Several approaches have been used for fitting quantitative relationships between soil properties and their environment in order to predict them spatially. This work aimed to present the steps required for solum depth spatial prediction from knowledge-based digital soil mapping, comparing the prediction to the conventional soil mapping approach through field validation, in a watershed located at Mantiqueira Range region, in the state of Minas Gerais, Brazil. Conventional soil mapping had aerial photo-interpretation as a basis. The knowledge-based digital soil mapping applied fuzzy logic and similarity vectors in an expert system. The knowledge-based digital soil mapping approach showed the advantages over the conventional soil mapping approach by applying the field expert-knowledge in order to enhance the quality of final results, predicting solum depth with suited accuracy in a continuous way, making the soil-landscape relationship explicit

Elucidation on the Effect of Operating Temperature to the Transport Properties of Polymeric Membrane Using Molecular Simulation Tool

Existing reports of gas transport properties within polymeric membrane as a direct consequence of operating temperature are in a small number and have arrived in diverging conclusion. The scarcity has been associated to challenges in fabricating defect free membranes and empirical investigations of gas permeation performance at the laboratory scale that are often time consuming and costly. Molecular simulation has been proposed as a feasible alternative of experimentally studied materials to provide insights into gas transport characteristic. Hence, a sequence of molecular modelling procedures has been proposed to simulate polymeric membranes at varying operating temperatures in order to elucidate its effect to gas transport behaviour. The simulation model has been validated with experimental data through satisfactory agreement. Solubility has shown a decrement in value when increased in temperature (an average factor of 1.78), while the opposite has been observed for gas diffusivity (an average factor of 1.32) when the temperature is increased from 298.15Â K to 323.15Â K. In addition, it is found that permeability decreases by 1.36 times as the temperature is increased

Ectopic callose deposition into woody biomass modulates the nano-architecture of macrofibrils

Plant biomass plays an increasingly important role in the circular bioeconomy, replacing non-renewable fossil resources. Genetic engineering of this lignocellulosic biomass could benefit biorefinery transformation chains by lowering economic and technological barriers to industrial processing. However, previous efforts have mostly targeted the major constituents of woody biomass: cellulose, hemicellulose and lignin. Here we report the engineering of wood structure through the introduction of callose, a polysaccharide novel to most secondary cell walls. Our multiscale analysis of genetically engineered poplar trees shows that callose deposition modulates cell wall porosity, water and lignin contents and increases the lignin–cellulose distance, ultimately resulting in substantially decreased biomass recalcitrance. We provide a model of the wood cell wall nano-architecture engineered to accommodate the hydrated callose inclusions. Ectopic polymer introduction into biomass manifests in new physico-chemical properties and offers new avenues when considering lignocellulose engineering