Comparative analysis of multiple-guarantor agreements

Issouf Soumaré, Fabien Youbissi and Michel Gendron

Journal of Risk Management in Financial Institutions, 2011, vol. 4, issue 2, 146-161

Abstract: Co-guarantor agreements are compared with independent-guarantor agreements. With co-guarantor agreements, the guarantor is more strongly affected by changes to project assets or to guarantor assets. These agreements seem more advantageous to creditors because of the diversification effect, ie each guarantor must consider not only its own ability to repay the loan but also the repayment capacity of other guarantors and the borrower. With both types of agreement, loan pricing is mainly determined by the risk inherent in project assets or guarantor assets, much more so than by similarity in asset characteristics among guarantors or by similarity in asset characteristics between guarantors and projects.

Keywords: co-guarantee; credit insurance; loan guarantee; project finance; G13; G22 (search for similar items in EconPapers)
JEL-codes: E5 G2 (search for similar items in EconPapers)
Date: 2011
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://hstalks.com/article/3020/download/ (application/pdf)
https://hstalks.com/article/3020/ (text/html)
Requires a paid subscription for full access.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aza:rmfi00:y:2011:v:4:i:2:p:146-161

Access Statistics for this article

More articles in Journal of Risk Management in Financial Institutions from Henry Stewart Publications
Bibliographic data for series maintained by Henry Stewart Talks ().