An empirical study on the relationship between customers' credit rating and their financial transcripts for loan assignment

Najafi, H.; Ahmadkhani, A.

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Management Science Letters

ISSN 1923-9343 (Online) - ISSN 1923-9335 (Print) Quarterly Publication Volume 2 Issue 1 pp. 301-306 , 2012

An empirical study on the relationship between customers' credit rating and their financial transcripts for loan assignment Pages 301-306 Download PDF

Authors: Hassan Najafi, Ahmad Ahmadkhani

DOI: 10.5267/j.msl.2011.08.005

Keywords: Banking industry, Customer rating, Financial transcript, Loan assignment, Revenue management

Abstract: One of the most important issues on revenue management in banking industries is the assignment of loan to customers. In fact, a big portion of banks' revenue is from loan assignment and choosing appropriate customers for loan assignment not only reduces the financial risk but also it can increase the revenue. In this study, we perform an empirical study to find out whether customers' financial statements could provide enough information about customers for loan assignment. The other objective of this study is to find out whether banks' officials could understand about the details of customers' financial statements. Finally, we want to find out whether there is any relationship between unpaid loans and customers' credit rating. The present study is executed on an Iranian bank by distributing a questionnaire analyzing the results. The results indicate that there are some strong evidence that financial statement could help bank official determine customers' credit rating. The survey also concludes that highly education and experienced employees are the best people for devoting best credit rating for customers.

How to cite this paper

 Najafi, H & Ahmadkhani, A. (2012). An empirical study on the relationship between customers' credit rating and their financial transcripts for loan assignment.Management Science Letters , 2(1), 301-306.

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