Using accounting‐based and loan‐related information to estimate the cure probability of a defaulted company

Faculty/Professorship: Management Accounting 
Author(s): Lohmann, Christian; Ohliger, Thorsten
Title of the Journal: European Financial Management
ISSN: 1468-036X, 1354-7798
Publisher Information: Oxford : Wiley-Blackwell
Year of publication: 2020
Pages: 620-640
Language(s): English
DOI: 10.1111/eufm.12279
The cure of a defaulted company has important implications for the estimation of the loss given default. In this study, we estimate the probability of a defaulted company being cured using data on a large international sample of defaulted companies. More specifically, we examine whether historic accounting information on a defaulted company and loan‐related information are associated with that company's probability of being cured. The main finding of our analysis is that both accounting‐based and loan‐related independent variables increase the validity of cure prediction models.
GND Keywords: Rechnungslegung ; Insolvenz ; Kreditfinanzierung ; Kreditsicherheit ; Unternehmenssanierung
Keywords: accounting information ; company cure ; collateralization ; cure probability ; defaulted company ; Global Credit Data
DDC Classification: 650 Management & public relations  
RVK Classification: QP 760   
Type: Article
Release Date: 17. June 2022