Banks' risk assessment of Swedish SMEs
Building on the literatures on asymmetric information and risk taking, this paper applies conjoint experiments to investigate lending officers' probabilities of supporting credit to established or existing SMEs. Using a sample of 114 Swedish lending officers, we test hypotheses concerning how information on the borrower's ability to repay the loan; alignment of risk preferences; and risk sharing affect their willingness to grant credit. Results suggest that features that reduce the risk to the bank and shift the risk to the borrower have the largest impact. The paper highlights the interaction between factors that influence the credit decision. Implications for SMEs, banks and research are discussed.
Year of publication: |
2007
|
---|---|
Authors: | Bruns, Volker ; Fletcher, Margaret |
Published in: |
Venture Capital. - Taylor & Francis Journals, ISSN 1369-1066. - Vol. 10.2007, 2, p. 171-194
|
Publisher: |
Taylor & Francis Journals |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Banks' risk assessment of Swedisch SMEs
Bruns, Volker, (2008)
-
Banks' risk assessment of Swedish SMEs
Bruns, Volker, (2008)
-
The role of human capital in loan officers' decision policies
Bruns, Volker, (2008)
- More ...