Building a Scoring Model for Small and Medium Enterprises

Răzvan Constantin Caracota, Maria Dimitriu and Maria-Ramona Dinu
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Răzvan Constantin Caracota: Bucharest Academy of Economic Studies
Maria Dimitriu: Bucharest Academy of Economic Studies
Maria-Ramona Dinu: „Politehnica” University of Bucharest

Theoretical and Applied Economics, 2010, vol. 9(550), issue 9(550), 117-128

Abstract: The purpose of the paper is to produce a scoring model for small and medium enterprises seeking financing through a bank loan. To analyze the loan application, scoring system developed for companies is as follows: scoring quantitative factors and scoring qualitative factors. We have estimated the probability of default using logistic regression. Regression coefficients determination was made with a solver in Excel using five ratios as input data. Analyses and simulations were conducted on a sample of 113 companies, all accepted for funding. Based on financial information obtained over two years, 2007 and 2008, we could establishe and appreciate the default value.

Keywords: scoring; small and medium enterprises; credit risk management; banking system; logistic regression. (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:agr:journl:v:9(550):y:2010:i:9(550):p:117-128

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