A Study on the Determinants of Loan Spread for REITs

2018 ◽  
Vol 26 (3) ◽  
pp. 79-107
Author(s):  
Jun-Hyung Kim ◽  
Sungsoo Koh
Keyword(s):  
Loan Spread

scholarly journals The Influence of Interest Rate Liberalization on Commercial Banks and Its Countermeasures

2020 ◽  
Vol 9 (1) ◽  
pp. 34
Author(s):  
Mengting Jiang
Keyword(s):  
Economic Development ◽  
Interest Rate ◽  
Commercial Banks ◽  
Economic Situation ◽  
Financial Reform ◽  
Interest Rate Liberalization ◽  
Loan Spread ◽  
Current Economic Situation ◽  
The Impact

<p>The liberalization of interest rate is an important part of the financial reform in China under the current economic situation, and it is the inevitable result of the economic development of China to a certain extent. With the deepening of interest rate liberalization reform in China, commercial banks have been affected to a certain extent; the deposit and loan spread, which accounts for the main income of commercial banks, has been narrowed, and the profit space of commercial banks has been further reduced. Therefore, this paper discusses the impact of interest rate liberalization on commercial banks and the choices that commercial banks should make under this situation.</p>

Bank loan spread and private information: pending approval patents

2014 ◽  
Vol 20 (2) ◽  
pp. 593-638 ◽  
Author(s):  
Marlene Plumlee ◽  
Yuan Xie ◽  
Meng Yan ◽  
Jeff Jiewei Yu
Keyword(s):  
Private Information ◽  
Bank Loan ◽  
Loan Spread

scholarly journals Internal Control Weakness and Bank Loan Contracting: Evidence from SOX Section 404 Disclosures

2011 ◽  
Vol 86 (4) ◽  
pp. 1157-1188 ◽  
Author(s):  
Jeong-Bon Kim ◽  
Byron Y. Song ◽  
Liandong Zhang
Keyword(s):  
Internal Control ◽  
Bank Loan ◽  
Control Problems ◽  
Section 404 ◽  
Loan Contracts ◽  
Loan Spread ◽  
Sarbanes Oxley ◽  
Loan Contracting ◽  
Internal Control Weaknesses ◽  
Loan Contract

ABSTRACT Using a sample of borrowing firms that disclosed internal control weaknesses (ICW) under Section 404 of the Sarbanes-Oxley Act, this study compares various features of loan contracts between firms with ICW and those without ICW. Our results show the following. First, the loan spread is higher for ICW firms than for non-ICW firms by about 28 basis points, after controlling for other known determinants of loan contract terms. Second, firms with more severe, company-level ICW pay significantly higher loan rates than those with less severe, account-level ICW. Third, lenders impose tighter nonprice terms on firms with ICW than on those without ICW. Fourth, fewer lenders are attracted to loan contracts involving firms with ICW. Finally, our within-firm analyses show that banks increase loan rates charged to ICW firms after their disclosure of internal control problems and that banks reduce loan rates after firms remediate previously reported ICW.

Customer concentration, relationship, and debt contracting

2017 ◽  
Vol 18 (2) ◽  
pp. 185-207 ◽  
Author(s):  
Ziyun Yang
Keyword(s):  
Strong Relationship ◽  
Customer Relationship ◽  
Future Research ◽  
Intangible Asset ◽  
Negative Effects ◽  
Content Type ◽  
Customer Base ◽  
Loan Spread ◽  
Debt Contract ◽  
Loan Contract

Purpose The purpose of this paper is to examine the effect of a firm’s customer base concentration on its loan contract terms and how this effect varies with the strength of its customer relationship. Design/methodology/approach This study is an archival research based on a sample of US public firms that have loan contract data between 1990 and 2008. Major customer sales data are used to construct customer concentration and customer relationship measures. A debt contract model is employed to relate loan spread and other contract terms to customer concentration and relationship. Findings This study finds that firms with more concentrated customer bases have higher loan spread and shorter loan maturity and are more likely to issue secured loans. These negative effects disappear when the supplier firm maintains strong relationship with its customers. Research limitations/implications Additional forward-looking measure of customer relationship could benefit future research. Practical implications A firm’s customer base characteristics can have significant impacts on the terms of its loan contracts. Findings from this study support the notion that customer relationship is an important intangible asset that is informative to stakeholders of the firm. Originality/value This study proposes a new measure of customer relationship based on the past repeated relationships between a firm and its major customers. It shows that customer characteristics may affect firms’ contracts with creditors: customer base concentration increases credit risk whereas strong customer relationship improves credit quality.

scholarly journals Critical risk factors of the project finance loan spread in the infrastructure sector: Experience from the ASEAN countries

Accounting ◽  
2021 ◽  
Vol 7 (6) ◽  
pp. 1507-1520 ◽  
Author(s):  
Elvi Nasution ◽  
Sugiarto Sugiarto ◽  
Gracia Shinta S ◽  
Ugut Ugut ◽  
Edison Hulu
Keyword(s):  
Risk Factors ◽  
Least Square ◽  
Project Finance ◽  
Loan Pricing ◽  
Policy Makers ◽  
Ordinary Least Square ◽  
Country Level ◽  
Loan Spread ◽  
Asean Countries ◽  
Net Export

This paper finds that in ASEAN-4, the micro loan characteristics: loan amount and LIBOR whilst the macro characteristics: inflation, net export and GDP growth influence the loan spread in the project finance. However, simultaneously at the country level, the determinants of the loan spread are distinctive to each country’s infrastructure industry characteristic. The paper’s main contribution relates to the determinants of the project finance loan spread at the country level and regional level, ASEAN-4. The purpose of this paper is to fathom the critical risk factors behind the project finance loan pricing differential across the ASEAN-4 countries. Hence, the policy makers, project developers and lenders can have a better understanding of the drivers behind the project finance loan spread pricing. The study adopted an ordinary least square (OLS) regression methodology and collected data from ASEAN-4 countries consisting of Indonesia, Malaysia, Philippines, and Thailand.

Risk-based price of mortgages

2019 ◽  
Vol 12 (3) ◽  
pp. 329-344
Author(s):  
Salvador Cruz Rambaud ◽  
María de los Ángeles Del Pino Álvarez
Keyword(s):  
Interest Rate ◽  
Yield Curve ◽  
Interest Rate Risk ◽  
Content Type ◽  
Loan Spread ◽  
Rate Risk ◽  
Banking Institutions ◽  
Adjustable Rate ◽  
Proper Estimation ◽  
The Interest Rate

Purpose The purpose of this paper is the analysis of the mortgage prices derived from the increase of defaults and the withdrawal of floor clauses in the mortgages offered by banking institutions in Spain. More specifically, this manuscript focuses on the evolution of the spread applied to mortgages contracted with a variable interest rate. Design/methodology/approach Two models have been considered to make a proper estimation of the yield curve to assess the loss due to the withdrawal of the floor clauses and quantify the component of the price used to cover the interest rate risk. Two different scenarios have been considered to avoid an underestimation of the aforementioned valuation. Findings The authors have shown that the increase in the percentage of doubtful mortgages has led to an increase in the spread of adjustable-rate mortgages. Moreover, the authors have shown that around 40 per cent of spreads are used to cover the interest rate risk. Originality/value The main contribution of this manuscript is the quantification of the loss expected by lenders and its impact in the spread. Due to this fact, the loan spread can be disaggregated into a component dependent on the credit risk associated with the borrower, and another component dependent on the interest rate risk to which the lender is exposed.

Bank Loan Spread and Private Information: Pending Approval Patents

2012 ◽  
Author(s):  
Marlene A. Plumlee ◽  
Yuan Xie ◽  
Meng Yan ◽  
Jeff Jiewei Yu
Keyword(s):  
Private Information ◽  
Bank Loan ◽  
Loan Spread
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