COLLATERAL, TYPE OF LENDER AND RELATIONSHIP BANKING AS DETERMINANTS OF CREDIT RISK
COLLATERAL, TYPE OF LENDER AND RELATIONSHIP BANKING AS DETERMINANTS OF CREDIT RISK
As regards collateral, the pledging of collateral increases the PD when compared with unsecured lending. Within secured loans, the PD of those that are 100% secured is lower than that of those secured to a value of over 50% but not to a full 100%, although the latter account for only a small percentage of the sample. Finally, loans guaranteed by a credit institution or the public sector have a lower likelihood of default, less even than in the case of unsecured loans. Note that this latter class