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Important contribution of this book is testing the investors’ influence and accounting information on the Bulgarian capital markets and their relations with credit default swap spreads. Bulgarian capital market is a part of the SEE group countries and it is a developing country and in the process of its development, people and investors should learn more about risk, credit risk management, and their relation to the rules of the listed companies and agencies. Many factors may provoke a change in stock prices: financial and monetary policies, macroeconomic conditions, investors’ expectations and country’s sovereign credit risk. Accepting sovereign CDS spreads as measurements of investment expectations regarding the development of Bulgarian capital market, we review the role of accounting information in CDS pricing because the accounting data may help investors make the most effective decision. The aim will be accomplished by creating an empirical model, based on the theoretical ones, including a panel data approach, several accounting variables, which are expected to have an impact on CDS spreads.n this research, we analyze the joint movement of eleven financial markets of South East Europe (SEE) - Bulgaria, Croatia, Greece, Serbia, Slovenia, Turkey, Romania, Montenegro, Macedonia, Banja Luka and Sarajevo (Bosnia and Herzegovina) using correlation and regression analysis during the period 2005-2015. We reveal the role of investors’ expectations on the capital markets dynamics and sovereign credit risk in Bulgaria. ABSTRACTING & INDEXING Southeast European Capital Markets: Dynamics, Relationship and Sovereign Credit Risk is covered by the following services: Baidu Scholar EBSCO Discovery Service Google Books Google Scholar J-Gate Naviga (Softweco) Primo Central (ExLibris) ReadCube Semantic Scholar Summon (ProQuest) TDOne (TDNet)

Capital market --- Europe --- Economic conditions. --- Economic policy. --- market integration, sovereign credit risk, accounting information.

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Banks play a critical role in financial intermediation. These institutions are channels for monetary circulation in the national economy. However, in its financial intermediation process, banks assume credit, market and operational risks. The dominant of these risks is credit and is associated with the loan book of banks. Banks risk eroding their capital if the quality of their risk assets (loans) deteriorates. Due to the detrimental effect of toxic assets on the profitability, liquidity and solvency of banks in particular and public confidence in the broader financial sector of a country, it is important to have a good understanding of the factors that affect or influence credit risk geographically (economy). This empirical study examines credit risk in Ghana, a Sub-Saharan African country positioned on the west coast of the continent. The study shows that only the bank specific variable of management efficiency and macroeconomic variable of previous year inflation affect credit risk in both locally and foreign owned banks. The study concludes that comparatively the determinants of credit risk do not differ between the ownership structure of the commercial banks. The result also suggests that bank management teams should carefully consider their decision making processes because it has a significant influence on value creation especially because it is a variable that is within their control unlike the macroeconomic indicator of inflation.

Credit Risk --- Non-Performing Loan --- Banking --- NPLs --- Ghana --- Sciences économiques & de gestion > Finance

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Since its creation in 2002, SOWALFIN has been facilitating access to finance to the SMEs in Wallonia, and has given them the opportunity to realize or complete their projects by providing solutions to their financial needs at key moments in their existence. One of these solutions is the granting of subordinated loans as a complement to bank lending.
These subordinated loans concern companies in the creation, development or transfer phases. The amount of the credit varies from €25,000 to €350,000 and SOWALFIN benefits from a bank guarantee of 1/3 of the amount of each loan. 
Financing activities are subject to credit risks that should be controlled by the company and reflected in its financial account in order not to jeopardize the company’s survival. These risks are covered through a provision for risks and charges and impairment of some specific assets. The willingness of SOWALFIN is to set up a methodology for calculating provisions and impairments more related to the risks to which it is exposed. In 2013-2014, SOWALFIN developed a risk scoring system which may be used in the methodology. The title of the project is: “The establishment of a methodology for calculating provisions and impairments to be recognized on subordinated loans at SOWALFIN”.
Several steps are necessary in order to realise this mission. Firstly, the realization of sector analyses in order to identify risks specific to each sector treated at SOWALFIN. This step allows classifying loans in portfolios in terms of the probability of default. Secondly, the assessment of the relevance of this sector analysis and of the credit scoring system in the risk of a company’s default. Thirdly, the analysis of the outcome of loans with specific risks (loans in judicial reorganisation procedure, loans with moratorium and with payment delays). The final step consists of the establishment of a methodology based on the sector risk analysis, on the individual risk identified through the credit scoring system, and on the specific risks. 
Carrying out these four steps will enable SOWALFIN to account for provisions and impairments representing the credit risks to which it is exposed.

Credit risk – Provision – Impairment – Sector analysis – Logistic regression – Subordinated loan – Accounting – Risk scoring system – Rate --- Sciences économiques & de gestion > Comptabilité & audit

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This paper studies the use of psychometric tests, which were designed by the Entrepreneurial Finance Lab as a tool to screen out high credit risk and potentially increase access to credit for small business owners in Peru. The analysis uses administrative data covering the period from June 2011 to April 2014 to compare debt accrual and repayment behavior patterns across entrepreneurs who were offered a loan based on the traditional credit-scoring method versus the Entrepreneurial Finance Lab tool. The paper finds that the psychometric test can lower the risk of the loan portfolio when used as a secondary screening mechanism for already banked entrepreneurs-that is, those with a credit history. For unbanked entrepreneurs-those without a credit history-using the Entrepreneurial Finance Lab tool can increase access to credit without increasing portfolio risk.

Access to credit --- Access to finance --- Asymmetric information --- Bankruptcy and resolution of financial distress --- Banks and banking reform --- Credit risk --- Debt markets --- Finance and financial sector development --- Psychometric tests

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The coronavirus (COVID-19) pandemic has halted economic activity worldwide, hurting firms and pushing them toward bankruptcy. This paper provides a unified framework to organize the policy debate related to firm financing during the downturn, centered along four main points. First, the economic crisis triggered by the spread of the virus is radically different from past crises, with important consequences for optimal policy responses. Second, to avoid inefficient bankruptcies and long-term detrimental effects, it is important to preserve firms' relationships with key stakeholders, like workers, suppliers, customers, and creditors. Third, firms can benefit from "hibernating," using the minimum bare cash necessary to withstand the pandemic, while using credit to remain alive until the crisis subdues. Fourth, the existing legal and regulatory infrastructure is ill-equipped to deal with an exogenous systemic shock such as this pandemic. Financial sector policies can help increase the provision of credit, while posing difficult choices and trade-offs.

Access to Finance --- Bankruptcy --- Bankruptcy and Resolution of Financial Distress --- Capital Markets and Capital Flows --- Cash Crush --- Coronavirus --- COVID-19 --- Credit Risk --- Economic Crisis --- Financial Crisis Management and Restructuring --- Financial Policy --- Financial Structures --- Pandemic Response --- Small and Medium Size Enterprise