Transactions accounts and loan monitoring
By: Loretta J. Mester, Leonard I. Nakamura, and Micheline Renault.
Contributors: Nakamura, Leonard Isamu.; Renault, Micheline.
Series: Working paper ;; no.  04-20; Working paper (Federal Reserve Bank of Philadelphia : Online) ;; no.  04-20.
Publisher: Federal Reserve Bank of Philadelphia
Published: 2004
Place of publication: Philadelphia, PA
Language: eng
Format: Electronic resource
Subjects: Bank loans.
Description: "We provide evidence that transactions  accounts help financial intermediaries monitor borrowers by offering lenders a  continuous stream of data on borrowers' account balances.  This information  is most readily available to commercial banks, but other intermediaries, such  as finance companies, also have access to such information at a cost.  Using a  unique set of data that includes monthly and annual information on  small-business borrowers at an anonymous Canadian bank, we provide empirical  evidence that transactions account information helps the bank to monitor  commercial borrowers' operating loans and we show the direct mechanism  through which an intermediary can use this information in monitoring and  controlling moral hazard problems associated with a rising probability of  bankruptcy"--Federal Reserve Bank of Philadelphia web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 1/26/2005.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.