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In this article, I study the effect of the Money Market Fund Liquidity Facility (MMLF) on corporate short‐term borrowing costs. Although MMLF loans accept a broader range of collateral acquired from money market funds (MMFs) than Asset‐Backed Commercial Paper Money Market Mutual Fund Liquidity Facility (AMLF) loans, their higher loan rates could make the intervention less effective. I find the average yield has decreased by 20–24 basis points. The yield‐decreasing effects of the MMLF are stronger for securities issued by eligible non‐US firms, non‐asset‐backed commercial paper securities that are newly accepted as collateral under the MMLF, and securities held by affiliated MMFs. However, I do not find an additional yield‐decreasing effect of the MMLF on lower rated securities or nonfinancial sector securities. After the implementation of the MMLF, domestic MMFs seem to increase the weight of nonfinancial sector securities, which helps them achieve a higher return. [ABSTRACT FROM AUTHOR]

Banks have a unique ability to hedge against market-wide liquidity shocks. Deposit inflows provide funding for loan demand shocks that follow declines in market liquidity. Consequently, banks can insure firms against systematic declines in liquidity at lower cost than other institutions. We provide evidence that when liquidity dries up and commercial paper spreads widen, banks experience funding inflows. These flows allow banks to meet loan demand from borrowers drawing funds from commercial paper backup lines without running down their holdings of liquid assets. We also provide evidence that implicit government support for banks during crises explains these funding flows. [ABSTRACT FROM AUTHOR]

This paper discusses digital neighbourhood communication in rural areas and its effects on local communal life. Therefore, survey data as well as guided interviews of residents in Metelen, county Steinfurt (Germany), are analysed. The results indicate that using digital neighbourhood platforms in rural communities intensifies contacts and further strengthens the feeling of social participation.However, digital neighbourhood contacts do not facilitate relationships concerning analogous material exchange, such as lending items. Furthermore, the analysis of the qualitative interviews shows that digital neighbourhood communication is used in the organisation of community life, presents local activities, and simplifies the organisation of local customs. All in all, those digital structures are mainly used for information purposes. Consequently, digital neighbourhood relations must be regarded when developing and organising future public services, although a functional usage is required to achieve a successful outcome. As digital contact emerges from analogous contact, occasions and infrastructure to actually ensure direct contact are inevitable. [ABSTRACT FROM AUTHOR]

Bail-outs by way of loan have a similar effect (on the debtor: plainly, the cost of delivering relief is allocated differently as between a bail-out and a bail-in) in that they enable the debtor to meet current fixed costs through borrowing, in effect swapping shorter-term liabilities with a longer-term liability. The authors acknowledge the support of the Oxford Law Faculty in funding the Conference "Corporate Restructuring Laws Under Stress" (St Hugh's College, Oxford, 10 October 2022) at which the papers in this special issue were first presented, and the support of the Covid-19 Research Response Fund at Oxford University, which provided funding for the wider project of which the Conference formed one part. Most authors, however, express some concerns in relation to Covid-19 bail-out design, and in particular query whether some bail-outs may have been too generous. [Extracted from the article]

This paper investigates a multi-period multi-product stochastic inventory problem in which a cash-constrained online retailer can leverage order-based loans provided by some Chinese e-commerce platforms to speed up its cash recovery for deferred revenue. Sample average approximation (SAA) and moment-matching scenario tree are adopted to solve this multi-stage problem with the objective of maximising the retailer's expected profit over the planning horizon. We conduct numerical tests based on crawling real data from an online store. The results show that the solutions of the two stochastic modelling approaches are very close. Moreover, the retailer tends to use order-based loans when its initial available cash is limited or it is facing a long revenue delaying length. Practitioners can make use of the modelling techniques in this paper to estimate whether it is beneficial to apply for an order-based loan. [ABSTRACT FROM AUTHOR]

Credit Scoring (9 papers) Regarding to P2P lending, the paper "Default or profit scoring credit systems? The paper "A credit scoring model based on the Myers-Briggs type indicator in online peer-to-peer lending" proposes an alternative credit scoring model for P2P lending by extracting typical personality types inferred from the borrowers' job category. The paper "The impact of working capital management on credit rating" finds that the deviation from the optimal working capital adversely affects the credit rating. [Extracted from the article]

Macro stress testing has become an increasingly important part of central banks' and macroprudential authorities' toolkits in the wake of the Global Financial Crisis. One of the most important parts of the stress testing framework is the estimation of credit risk losses under adverse circumstances. However, standard satellite models based on econometrics of time series may not be well suited to estimate credit risk losses for countries with short time series, incomplete credit cycle or structural breaks, as in the case of Slovakia. Incorporating micro data into the stress testing framework becomes important for such countries. In this paper, we show that using micro data leads to more plausible results compared to time series in form of higher estimated share of nonperforming loans. For the estimations, we use a unique set of individual retail loan data collected from banks operating in Slovakia. As the Slovak banking sector did not face a rapid worsening of the credit quality of retail loans during the Global Financial Crisis, the recent Covid-19 pandemic in 2020 is the only reference period of increased economic and financial tensions. This period also confirms our approach, as using micro data leads to nonperforming loan ratios that are closer to the ratio of indebted households asking for loan payment deferral during the pandemic. [ABSTRACT FROM AUTHOR]

Indian banks are continuously facing fund scarcity in meeting loan requirements. They have fewer deposits in comparison to the loan demands, which has led to a decrease in the liquidity of banks and nonbanking institutions. To get rid of this problem, banks use several conventional methods, and securitization is one of them. Securitization is known as the construction of security in any financial transaction. The paper seeks to find out whether securitization process can positively impact Indian banking industry, using selected bank performance parameters. The paper first presents the impact of securitization on banks' performance; then it depicts the hurdles to the growth of securitization in the country. [ABSTRACT FROM AUTHOR]

This study investigates the bank risk-taking channel of monetary policy transmission by comprehensively analyzing multiple bank risk measurements amid monetary policy shocks in Vietnam. Using banking data for 2008-2021, a dynamic panel model is estimated to examine the risk exposure of 30 Vietnamese commercial banks. The paper employs the annual M2 money supply growth as a monetary policy variable, besides two policy interest rates established by the central bank. We find that an expansion of monetary policy benefits the quality of loan portfolios; however, reduced interest rates or an extended money supply increase insolvency risk. We also document that heightened economic growth corresponds to a reduced likelihood of credit and insolvency risks, while a surge in the inflation rate leads to an escalation in insolvency risk, manifested by a decline in the Z-score index. Overall, the findings on different risk dimensions in this paper are expected to draw a comprehensive picture of banks' risk appetite and behavior in response to monetary changes. [ABSTRACT FROM AUTHOR]