Showing papers on "Credit risk published in 1971"

Cashflow Simulation for Evaluating Credit Risk on Corporate Bonds

Abstract: Corporate bonds and privately placed loans constitute a large proportion of the portfolios of several financial institutions. When bonds of a corporation are purchased in the market or loans are granted by some other arrangement, the lender evaluates the risk relating to the investment in question. Determination of the level of risk is important, among other things, for facilitating comparison between different investments, setting the terms of loan agreements and making a rational decision concerning the acceptance or rejection of a loan proposal. Since evaluation of risk is very important for rational investment decision-making, the nature of risk in bond investment is examined briefly in the next section. In the subsequent sections, the prevailing techniques of evaluation of risk will be reviewed and the cash flow simulation model presented.

Social Priorities and the Market Allocation of Credit

Abstract: sion concerning financial responsibility for the allocation of resources for social goals. Some contend that there is a widening gap between the performance of our financial institutions and the desires of society. They assert that society is concerned primarily with the relative shares of total expenditure in individual sectors of the economy, and that this is inconsistent with the concern of national monetary policymakers for aggregate activity and the profit motive governing the private financial community.