Credit ratings, private information, and bank monitoring ability

Leonard Nakamura and Kasper Roszbach ()

Journal of Financial Intermediation, 2018, vol. 36, issue C, 58-73

Abstract: In this paper, we use credit rating data from two large Swedish banks to elicit evidence on banks’ loan monitoring ability. For these banks, our tests reveal that banks’ internal credit ratings indeed include valuable private information from monitoring, as theory suggests. Banks’ private information increases with the size of loans.

Keywords: Monitoring; Banks; Credit bureau; Private information; Public information; Ratings; Regulation; Supervision; Overconfidence (search for similar items in EconPapers)
JEL-codes: D82 G18 G21 G24 G32 G33 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (11)

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Related works:
Working Paper: Credit Ratings, Private Information, and Bank Monitoring Ability (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jfinin:v:36:y:2018:i:c:p:58-73

DOI: 10.1016/j.jfi.2017.11.001

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