Risk control mechanisms of third-party guarantee when financing newsvendor

Two risk control mechanisms, namely, cash deposit, and loan limits based on retained profit or maximum expected guarantor profit, are developed for capital-constrained newsvendor financing. Results show that with a large initial capital or mortgage asset, the newsvendor reduces the order quantity to avoid bankruptcy risk. Under the risk control mechanism with a cash deposit, the guarantor gains greater profit when the newsvendor has a low initial capital. Setting a loan limit is thus an effective mechanism for newsvendors to not only reduce the bankruptcy risk, but also increase the guarantee profit. Numerical experiments also show that, compared with the risk control mechanism based on maximum expected profit, loan limits based on retained profit is more beneficial for the newsvendor, guarantee, and the bank.

Implementation of Simple Additive Weighting in Providing Micro Business Loans at Bank Mandiri Pematangsiantar

Banks are institutions and institutions that are organizations and institutions in Indonesia and have an important role in the sustainability of the Indonesian economy. Bank Mandiri is one of the banks that provides micro business credit facilities to the business world. The higher the public's interest in getting micro business credit, the banks need software to help determine who is entitled to credit. In order to produce a proper feasibility analysis, a method of decision-making in overcoming these problems is needed so that determining who is entitled to receive credit is not too long and efficient in reducing credit risk. Problems arise in the decision-making process for granting micro-business loans, namely the inaccuracy of micro-business credit recipients. The above problems can be resolved by building a Decision Support System which can assist decision makers in assessing and selecting micro business loans using variables: Income, Collateral, Loan Limit, Installments, Length of Business, Number of Dependents. The system built by applying the Simple Additive Weighting method is known as the method of adding weight. The Simple Additive Weighting method requires a decision matrix normalization process to a scale that can be compared with all available alternative ratings. This will be a reference in ranking and consider the advantages and disadvantages of applying for a credit loan in order to find the desired candidate. From the test results using 10 data samples, it was obtained that the first rank was received credit on behalf of A5 with a value of 9.33, and the last rank was on behalf of A6 with a value of 6.4. and very helpful in solving problems faced by Bank Mandiri Pematangsiantar.

Regressive Mortgage Credit Redistribution in the Post-Crisis Era

We document four secular trends about U.S. mortgage origination by traditional and FinTech lenders after the 2008-2009 financial crisis. First, since 2011, the overall number, size, and approval rate of small and medium-sized loans have been decreasing over time, relative to large loans. Second, the largest lenders redistribute their lending the most. Third, this loan-size redistribution of credit increases in the size of the lender. Fourth, the effects are stronger for mortgages further away from the conforming loan limit(s) in both directions. We argue that the supply of credit drives these secular trends, and we assess several potential economic mechanisms.

When Investor Incentives and Consumer Interests Diverge: Private Equity in Higher Education

We study how private equity buyouts create value in higher education, a sector with opaque product quality and intense government subsidy. With novel data on 88 private equity deals involving 994 schools, we show that buyouts lead to higher tuition and per-student debt. Exploiting loan limit increases, we find that private equity-owned schools better capture government aid. After buyouts, we observe lower education inputs, graduation rates, loan repayment rates, and earnings among graduates. Neither school selection nor student body changes fully explain the results. The results indicate that in a subsidized industry, maximizing value may not improve consumer outcomes. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

PERANAN AUDIT INTERNAL TERHADAP PENCEGAHAN & PENDETEKSIAN KECURANGAN (FRAUD) DI KOPERASI KARYAWAN PT. PLATINUM CERAMICS INDUSTRY ATAS KINERJA TAHUN BUKU 2014

ABSTRACTThe purpose of this study was to know the role of Internal Audit in the prevention and detection of fraud in the Cooperative Employees of PT. Platinum Ceramics Industry. The type of data that is used the use of qulitative data , methods of data collection by study the literature and field study, obtain data in writing of the research literature , reviewing the literature books and scientific papers related to the title of thesis, observation, and interviews. Results of research conducted shows Internal audit in this case supervisor in the Cooperative Employees PT. Platinum Ceramics Industry is still weak and ineffective, because there is a violation in the Standard Operating Procedure (SOP) which can lead to fraud. Standard Operating Procedure violations occur because of the policy of the cooperative management. Cooperative management assessed incorrectly and poorly targeted in the provision of policy which violates the rules of the loan ceiling and ceiling pieces. Decisions adopted a policy exceed the loan limit rules and ceiling pieces can lead to a lot of bad debts, it is because the number of members in the cooperative debt is higher than the number of old age benefits (severance) in the company Keywords: Internal Audit, Fraud Prevention and Detection, Internal Control

The Interest Rate Elasticity of Mortgage Demand: Evidence from Bunching at the Conforming Loan Limit

This paper provides novel estimates of the interest rate elasticity of mortgage demand by measuring the degree of bunching in response to a discrete jump in interest rates at the conforming loan limit—the maximum loan size eligible for purchase by Fannie Mae and Freddie Mac. The estimates indicate that a 1 percentage point increase in the rate on a 30-year fixed-rate mortgage reduces first mortgage demand by between 2 and 3 percent. One-third of this response is driven by borrowers who take out second mortgages, which implies that total mortgage debt only declines by 1.5 to 2 percent. (JEL D14, G21, R21, R31)