Journal of Risk Analysis and Crisis Response

Volume 2, Issue 1, May 2012, Pages 56 - 60

Evaluating of Loan Guarantees Between Parent and Subsidiary Based on Vulnerable Option

Authors
Li Li, Zongfang Zhou, Xiao Lei
Corresponding Author
Li Li
Received 26 November 2011, Accepted 12 March 2012, Available Online 1 May 2012.
DOI
https://doi.org/10.2991/jracr.2012.2.1.6How to use a DOI?
Keywords
Business group, Vulnerable option, Loan guarantees, Credit risk.
Abstract
Loan guarantees between parent and subsidiary is the main related transaction in business group, its correct estimation is the foundation of controlling group’s credit risk. Applying option theory, this paper researches the vulnerable option characters of loan guarantees, gives the valuation model under two different security methods, theoretically analyzes the influence of such critical factors as companies asset value and equity ratio to loan guarantees’ value and provides theoretical basis for the decision-making of loan guarantees.
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Journal
Journal of Risk Analysis and Crisis Response
Volume-Issue
2 - 1
Pages
56 - 60
Publication Date
2012/05
ISSN (Online)
2210-8505
ISSN (Print)
2210-8491
DOI
https://doi.org/10.2991/jracr.2012.2.1.6How to use a DOI?
Open Access
This is an open access article distributed under the CC BY-NC license.

Cite this article

TY  - JOUR
AU  - Li Li
AU  - Zongfang Zhou
AU  - Xiao Lei
PY  - 2012
DA  - 2012/05
TI  - Evaluating of Loan Guarantees Between Parent and Subsidiary Based on Vulnerable Option
JO  - Journal of Risk Analysis and Crisis Response
SP  - 56
EP  - 60
VL  - 2
IS  - 1
SN  - 2210-8505
UR  - https://doi.org/10.2991/jracr.2012.2.1.6
DO  - https://doi.org/10.2991/jracr.2012.2.1.6
ID  - Li2012
ER  -