This diploma thesis -- Credit risk management and business cycle -- is divided in four chapters. The first explains the purpose of bank as the financial intermediate and the main financial risk, which may results from its activities. The second part describes the theory of business cycle from the view of the main economic schools and clears up the problems of price bubbles on assets markets. The third part analyses the models and methods of credit risk management in the financial institution and the roles of regulatory authorities including the influence of Basel II. The last part concerns about credit risk development in bank sector in the Czech Republic including the ČNB macroeconomic credit risk model. The main focus is how the changes in business cycle development influence the credit risk.

This thesis is focused on the credit risk management in the leasing company. Firstly, the attention is paid to leasing market in the Czech Republic and leasing by itself. Afterwards are described risks which leasing companies during their business activities are exposed. Emphasis is placed mainly on the credit risk management. Major part of the thesis deals with ex-ante and ex-post credit risk analysis in leasing business. At first is analyzed approval of the business transaction. Below the process of administration of debtor's statement in the leasing company is analyzed. Final case study performs the practical application of methods and procedures in the credit risk management.

The main objective of this diploma thesis is to simulate the regular decision-making process that a credit analyst goes through when assigning a credit limit for an operating and investment (acquisition) loan for a selected company. The introductory chapter is focused on credit risk category definition and description of main credit risk quantification and mitigation approaches both on individual as well as portfolio basis. The second, practically oriented part includes both financial and strategic analysis of selected business entity, as well as free cash flow prediction followed up by business plan development, all of these carried out in the form of basic analytical tools necessary for credit limit assignments to both short term operating and long term investment (acquisition) loans. In the final part, the selected company is being evaluated using DCF Entity business valuation framework as well as being subject to comparable companies and transactions general valuation approach. Finally, the credit limits for an operating and investment (acquisition) loans are being determined based on the analytical tools drafted within the previous chapters of this thesis.

This assignment shows the importance in deference to credit ceiling for legal entities in bank establishment. Several stages from the process were analyzed. Starting from the files of the requesting company, analysis of its financial economical capacity through of patrimony structure rates, net rates, economic rates, average term indicators, necessity of working capital, vertical, horizontal analysis and a standardrate, an assessment of the client visited and finally, the establishment of credit ceiling respective, according to the credit policy of a determined financial institution. / Este trabalho apresenta a importância do deferimento de limite de crédito a pessoas jurídicas, em estabelecimentos bancários. Foram analisadas as diversas etapas do processo, iniciando pela confecção do cadastro da empresa solicitante, análise da sua capacidade econômico-financeira, feita através dos índices de estrutura patrimonial, índices de liquidez, índices de rentabilidade, indicadores de prazos médios, necessidade de capital de giro, análise vertical, horizontal e índice-padrão; avaliação da visita efetuada ao cliente e, por fim, o estabelecimento do respectivo limite de crédito, de acordo com os critérios de determinada instituição financeira.

Risk and profitability are two topics that companies today have to face and deal with. There are different type of risks that either directly or indirectly affect the survival of a company.After the financial crisis in 2008, new regulations and capital requirements was establishedto better cope with future crisis, as the survival of banks and credit market companies hasa vital impact on society. The objective of this thesis has been to create a model that estimates profitability withrespect to various risks but above all credit risk. Risks that credit market companies has tocomply with has been provided by PayEx via documents or meetings. Further knowledgewithin the area of risks has been acquired by reading capital requirements and regulations.The main focus on capital requirements and regulations landed in Basel III and InternalCapital Adequacy Assessment Process (ICAAP). To initiate the project an excel document was provided electronically which laid groundfor the model that was later built in the programming language Python. The first stepin building the model was to replicate all calculations so the model gave the same outputas in the excel document. Further, functions were made to be used in a simulation to seewhich parameters affected the risk-adjusted return on capital (RAROC) the most. When allsimulations were made a visualization of the results in form of plots was created to simplifythe understanding of the results. Important dynamic parameters used in the model was the end customers choice of paymentmethod, payment methods including a fee and percentage change in contract payment. Allmentioned parameters made impact on how profitable a business case were. Conclusions from the results are that payment methods, percentage change in contractpayment and payment methods including fees all affect the profit or RAROC. A recommendationis that PayEx should try to steer customers to pay according to Set 2 or Set 7,negotiate the percentage change in contract payment or add a fee to payment method 4 ifcustomers choose to pay that way. Further explanations of the mentioned Sets can be foundin Section 4.1.2. / Lönsamhet och risk är två ämnen som företag idag måste ha i åtanke och förhålla sig till. Det finns olika typer av risk som antingen direkt eller indirekt påverkar ett företags överlevnad.Efter den finansiella krisen 2008, upprättades nya regler och kapitalkrav för att bättre kunnahantera framtida kriser. Detta för att kreditmarknadsbolag och banker har en stor inverkanpå samhället om de skulle gå i konkurs. Syftet med denna avhandling har varit att skapa en modell som ska estimera lönsamhet iförhållande till olika risker, men i huvudsak kreditrisk. Risker som kreditmarknadsbolagmåste förhålla sig till har tillhandahållits av PayEx via möten eller dokument. Ytterligarekunskap om risk har förvärvats genom att läsa kapitalkrav och förordningar. Huvudfokus påkapitalkrav och förordningar landade i Basel III och Internal Capital Adequacy AssessmentProcess (ICAAP). För att påbörja projektet skickades ett exceldokument elektroniskt som sedan lade grundenför modellen som skapades i programeringsspråket Python. Första steget i modellbyggandetvar att replikera alla beräkningar som gjorts i exceldokumentet och kontrollera att modellengav samma resultat. Efter det skapades funktioner som skulle användas i simuleringen föratt se vilka parametrar som påvärkade den riskjusterade avkastningen på kapital mest. Näralla simuleringar var gjorda skapades en visualisering av resultaten i form av olika grafer.Det gjordes för att förenkla förståelsen av resultaten. Viktiga dynamiska parametrar som användes i modellen var bland andra, slutkundens valav betalmetod, betalmetod inklusive avgift samt procentuell förändring av kontraktsköp.Alla nämnda parametrar hade stor påverkan på hur lönsamt ett business case är. Slutsatser av resultaten är att betalmetod, procentuell förändring av kontraktsköp och betalmetodinklusive avgift alla påverkar lönsamheten och riskjusterad avkastning på kapital.Rekommendationer till PayEx är därför att försöka styra kunderna att betala enligt Set 2eller Set 7, förhandla om den procentuella förändringen av kontraktsköp eller att addera enavgift till betalmetod 4 om kunder väljer att betala på det sättet. Djupare förklaringar avnämnda Sets finns i Section 4.1.2.

Bakgrund: Den 1 november 2010 avskaffades revisionsplikten för små företag i Sverige, vilket innebar att små företag får välja om de vill ha en revisor eller inte. Ett av motiven bakom lagändringen var att småföretagens tillväxt skulle öka. För att öka tillväxten krävs finansiering. Småföretagens främsta finansieringskällor är eget kapital och löpande intäkter. Detta räcker emellertid inte utan företagen behöver ofta komplettera med externfinansiering, i form av banklån. Trots vikten av externt kapital har små företag svårare än stora företag att finansiera tillväxten med banklån. En av anledningarna till detta är att den finansiella informationen som bankerna samlar in är bristfällig. För att informationens trovärdighet ska öka önskar därför bankerna att den finansiella informationen är granskad av en revisor. Syfte: Syftet med studien är att förklara hur bankerna upplever att kreditbedömningen av små företag har påverkats av frivillig revision. Således syftar studien till att öka förståelsen för hur kreditbedömningen går till samt vilken roll revisorn har i denna. Metod: Studien har baserats på den kvalitativa metoden där sex stycken intervjuer har genomförts. Fem av dessa har varit telefonintervjuer medan en har varit en personlig intervju på informantens arbetsplats. Alla informanter arbetar inom banksektorn och var tillgängliga inom Skaraborgsområdet, därmed har både ett strategiskt- och bekvämlighetsurval gjorts. Resultat och slutsats: Studien visar på att revisionen har en viss roll vid kreditbedömningen genom sin granskningsfunktion. Däremot kan inte studiens resultat påvisa att bankerna i Skaraborg har upplevt att den frivilliga revisionen har haft en avgörande påverkan på kreditbedömning. / Background: On 1 November 2010 the statutory audit for small firms in Sweden was abolished, which meant that small firms were allowed to choose whether or not to havean auditor. One of the motives behind the change in the law was that the growth of small firms would increase. In order to increase growth, financing is required. The main source of financing for small firms are equity and current income. However, this is not enough,and small firms often need to supplement with external financing, in the form of bankloans. Despite the importance of external capital, small firms find it more difficult than large firms to finance economic growth with bank loans. One of the reasons for this is that the financial information collected by banks is inadequate. Therefore, in order to increase the credibility of the information, the banks wish that the financial information is audited by an auditor. Purpose: The purpose of the study is to explain how the banks feel that the credit assessment of small firms has been affected by the voluntary auditing. Thus, the aim of the study is to increase the understanding of how the credit assessment is carried out and what role the auditor has in it. Methods: The study has been based on the qualitative method where six interviews have been conducted. Five of these have been telephone interviews while one has been a personal interview at the informant’s workplace. All the informants work in the banking sector and were available in the Skaraborg area, thus both a strategic and convenience selection has been. Results and conclusion: The study shows that the audit has a certain role in the credit assessment through its function. However, the results of the study cannot show that the banks in Skaraborg have experienced that the voluntary audit has had a decisive impact on credit assessment.

Background: The credit rating agencies have been heavily contested and criticized. In addition to this, other informational sources may potentially deliver the information that the CRA is intended to provide. This may have changed their role in reducing information asymmetry in the financial market. Purpose: This thesis will investigate (i) whether changes (upgrade/downgrade) in credit ratings lead to abnormal returns in share value, and thereby provide useful information to potential and current investors. The thesis will also (ii) examine whether there are significant differences between the periods before and after the GFC in 2008. Method: Regression based event study using a dummy-variable approach. Conclusions: No strong evidence that credit ratings have a significant effect on stock prices in the European stock market. Small indications that the market is responding more strongly to a rating change announcement during the period 2000-2008 compared to 2009-2019.

1 Behaviour of non-bank consumer credit providers in terms of unfair competition Abstract The thesis deals with the issue of providing consumer loans by non-bank providers of consumer loans in terms of the correctness of their actions in selected areas of their activities. The aim of this work is to assess selected typized behaviour of non-bank providers of consumer loans in terms of the possibility of committing (both) unfair commercial practices and unfair competition. The author thus examines the behaviour of these entities in connection with their information duty and the duty to assess creditworthiness of consumers. In the area of information duty, it focuses more on the pre-contractual information obligation for non-bank consumer credit providers and the obligation for these entities to inform consumers of the annual percentage rate of charge. The subject of the thesis is also an assessment of possible concurrent responsibility of non-bank providers of consumer credit for committing unfair commercial practices and unfair competition. The sanctions provided for by the Consumer Credit Act are also taken into account. The author also describes the development of legislation in defined areas, where the work includes a comparison of current and previous legislation on consumer credit. The thesis contains...

This paper explores the link between agriculture investment and agriculture output in Namibia. The existing theory on investment and growth constitutes a basis for empirical work on investment-output nexus. Neither the neoclassical nor the new growth theories on investment have considered the growth effects of investment at sector and industry level and its implication on capital allocation, particularly for developing countries that are resource constrained. The key question addressed in this paper is whether investment in agriculture is associated with agriculture output, both at the sector and sub-sector levels. The paper adopted the ARDL bounds test model constructed with quarterly data for the period 2000 to 2020 and found that investment and agricultural output exhibit a long-run relationship. The coefficient estimates showed that public investment, development bank loans and agriculture export have a positive impact on agricultural output while inflation, lending rates and commercial bank loans have a deleterious effect. The long-run causality tests suggest that there is unidirectional causality between commercial credit expenditure and aggregate agriculture output, as well as a unidirectional causality running from exports to livestock and crop sub-sector output. Based on error correction terms, agriculture output tends to rapidly adjust to short-term disturbances, hence rebound of agriculture output to a long-run growth path can take place with minimum or no delays. This study concludes that the Keynesian hypothesis is valid for Namibia's agriculture and the direction of causality is from investment to agriculture growth. Therefore, the role of government in supporting sustainable development of the agricultural sector cannot be overemphasised.

The 2007/2008 financial crisis and the role that credit rating agencies (CRA’s) played leading up to the crisis precipitated the introduction of CRA regulation worldwide. By using Giddens’s (1990. 1991) theory of modernity as a framework, this study explores the rationale for the introduction of CRA regulation in South Africa (the Credit Rating Services Act No. 24 of 2012), with a specific focus on trust and legitimacy. The findings in this study suggest that while the introduction of new regulation is a mechanism used to legitimise the capital system, it often has limitations and unforeseen consequences. This study used detailed interviews with some of South Africa’s leading experts on the credit rating industry to explain the reasoning for South African CRA regulation. Lastly, this thesis adds to the scant body of interpretive (and normative) research on the use of arms-length regulation in modern governance discourse, and it is also the first research to explore CRA regulation in the South African context.