Empirical findings and theoretical studies suggest that firms adjust toward time-varying target leverage ratios. This paper studies the performances of the default probabilities generated from two structural credit risk models (one with time-dependent leverage ratios and one with constant target...

The study's objective is to check whether the predictive power of Machine Learning Techniques is better than Logistic Regression in predicting the bankruptcy of firms and that the same predictive power of ascertaining bankruptcy improves when a proxy for uncertainty is added to the model as a...

Numerous applications of AI are found in the banking sector. Starting from the front-office, enhancing customer recognition and personalized services, continuing in the middle-office with automated fraud-detection systems, ending with the back-office and internal processes automatization. In...