194 research outputs found
Loan Officer Authority and Small Business Lending.Evidence from a survey.
A vast literature has emphasized that small banks are at a comparative
advantage in small business lending. In this paper, we show that apart from
size, which is negatively correlated with bank specialization in small
business lending, organizational characteristics affect bank loan portfolio
choices. By using a unique dataset based on a recent survey of Italian banks,
we find that after having controlled for bank size, a branch loan officer’s
authority has a key role in explaining bank specialization in small business
lending. In particular, banks which delegate more decision-making power to
their branch loan officers are more willing to lend to small firms than other
banks. We approximate loan officers’ authority by controlling for several
factors which shape their incentives: loan officer turnover, the amount of
money up to which they are allowed to lend autonomously, their role in
loan approval and in setting loan interest rates, the kind of information (soft
versus hard information) used for screening and monitoring borrowers, and
the structure of their compensation schemes
Loan Officer Authority and Small Business Lending.Evidence from a survey.
A vast literature has emphasized that small banks are at a comparative
advantage in small business lending. In this paper, we show that apart from
size, which is negatively correlated with bank specialization in small
business lending, organizational characteristics affect bank loan portfolio
choices. By using a unique dataset based on a recent survey of Italian banks,
we find that after having controlled for bank size, a branch loan officer’s
authority has a key role in explaining bank specialization in small business
lending. In particular, banks which delegate more decision-making power to
their branch loan officers are more willing to lend to small firms than other
banks. We approximate loan officers’ authority by controlling for several
factors which shape their incentives: loan officer turnover, the amount of
money up to which they are allowed to lend autonomously, their role in
loan approval and in setting loan interest rates, the kind of information (soft
versus hard information) used for screening and monitoring borrowers, and
the structure of their compensation schemes
Systemic importance of financial institutions: regulations, research, open issues, proposals
In the field of risk management, scholars began to bring together the quantitative methodologies with the banking management issues about 30 years ago, with a special focus on market, credit and operational risks. After the systemic effects of banks defaults during the recent financial crisis,
and despite a huge amount of literature in the last years concerning the systemic risk, no standard methodologies have been set up to now. Even the new Basel 3 regulation has adopted a heuristic indicator-based approach, quite far from an effective quantitative tool. In this paper, we refer to the different pieces of the puzzle: definition of systemic risk, a set of coherent and useful measures, the computability of these measures, the data set structure. In this challenging field, we aim to build a comprehensive picture of the state of the art, to illustrate the open issues, and to outline some paths for a more successful future research. This work appropriately integrates other useful surveys and it is directed to both academic researchers and practitioners
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