What Drives the Time to Resolution of Defaulted Bank Loans?

Posted: 28 Feb 2018

See all articles by Jennifer Betz

Jennifer Betz

Independent

Ralf Kellner

Saarland University

Daniel Roesch

University of Regensburg

Date Written: 2016

Abstract

Using a unique data base of Global Credit Data with individual loan information from small and medium sized entities in Germany, Great Britain and the United States, we evaluate the time to resolution of defaulted loans. A comparison across countries reveals country specific drivers for the resolution time which can be explained fairly well by differences in the regulatory and legal framework. Lenders seem to be aware of these differences and adjust their lending behavior in the limits set by these bankruptcy systems of the countries.

Keywords: credit risk, bankruptcy, resolution of financial distress, time to resolution, resolution bias

JEL Classification: C51, G01, G28

Suggested Citation

Betz, Jennifer and Kellner, Ralf and Roesch, Daniel, What Drives the Time to Resolution of Defaulted Bank Loans? (2016). Finance Research Letters, Vol. 18, 2016, Available at SSRN: https://ssrn.com/abstract=3126234

Jennifer Betz

Independent ( email )

Ralf Kellner

Saarland University ( email )

Stadtwald
Saarbrucken, Saarland D-66123
Germany

Daniel Roesch (Contact Author)

University of Regensburg ( email )

Chair of Statistics and Risk Management
Faculty of Business, Economics and BIS
Regensburg, 93040
Germany

HOME PAGE: http://www-risk.ur.de/

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