Debt Claims Research Articles

Penyelesaian Kredit Macet Terkait Adanya Tagihan Utang Pajak Debitur di Bank BRI Kantor Cabang Medan Thamrin

The implementation of mortgage execution, execution (parate execution) must be based on a promise to sell under one's own power as regulated in Article 1178 paragraph (2) of the Civil Code, so that it is an implementation of an agreement and accompanied by a mortgage deed grosse which is intended "For the sake of Justice Based on the Almighty Godhead" This research is descriptive analytical in nature. The type of research used in this thesis is empirical legal research. Types and sources of data that will be used secondary and primary data. Data analysis was carried out to answer the problems studied using qualitative methods. Research using qualitative methods starts from assumptions about reality or social phenomena that are unique and complex. There is a certain regularity or pattern in it, but it is full of variations (diversity) in the facts contained in the problem being studied. Settlement of bad credit related to mortgage rights at Bank BRI Medan Thamrin Branch is preceded by steps taken by the bank to collect outstanding payments from debtors who have bad credit. The collection process is carried out through warning letters, telephone calls, or direct visits to debtors. If the debtor has not paid his obligations, the bank will then take steps to sell the assets through auction for the debtor's bad credit collateral. Regarding bills from taxpayers who are debtors of BRI Bank Medan Thamrin Branch, then if a taxpayer has an unpaid tax bill and he is a bank debtor, then the bank can withdraw funds from the taxpayer's bank account to pay the tax bill. This can be done based on a Tax Assessment Letter (SKP) issued by the tax authority which stipulates that the taxpayer must pay a certain tax bill. Settlement of debtors' bad debts at Bank BRI is related to taxpayers' tax debt claims against debtors. In an effort to provide legal certainty, the debtor's collateral object can be executed by the bank and then the sales proceeds are divided proportionally to the bank for bank credit debts and the tax office. on taxpayer debt.

External Debt Claims of the Russian Federation: Peculiarities of Legal Regulation

In financial legal relationships between States, relationships concerning provision of temporarily available funds for loans are well developed, which implies that one party has a debt, and the other party has a loan. The Russian Federation has external debt claims against other States because of the provision of financial and export credits regulated by budget legislation and relevant intergovernmental agreements. As a result of the study, the following conclusions were made: a) the domestic legislator imposes certain economic and political requirements on the potential borrower State, which allow us to conclude about its financial stability and solvency, as well as about the absence of involvement in any conflicts; b) information on public lending programs in relation to foreign countries is set forth in appendices to the federal budget law for a certain period on the terms of the secrecy order; c) international financial organizations, in particular the World Bank, publish information on lending to developing countries, including the Russian Federation; d) the most active borrowers from Russia are Belarus and a number of countries in Africa and Asia, including those States that preserved their borrower status from the Soviet period.

Clearing payments in dynamic financial networks

This paper proposes a novel dynamical model for determining clearing payments in financial networks. We extend the classical Eisenberg–Noe model of financial contagion to multiple time periods, allowing financial operations to continue after initial pseudo defaults, thus permitting nodes to possibly recover and eventually fulfill their liabilities. Dynamic optimal clearing payments in our model are computed by solving a suitable linear program, both in the full matrix payments case and in the pro-rata constrained case. We prove that the proposed model obeys the priority of debt claims requirement, that is, each node at every step either pays its liabilities in full, or it pays out all its balance. In the pro-rata case, the optimal dynamic clearing payments are unique, and can be determined via a time-decoupled sequential optimization approach.

Inclusion of debt claims in asset pricing models: Evidence from the CDS Index

Asset pricing theory suggests that the correct proxy for the market portfolio should contain both the debt and equity claims of the economy, whereas prevailing empirical studies fail to include the debt claim. Motived by the discrepancy between the theoretical and empirical models and the difficulty in constructing proxies, the study uses the Credit Default Swaps (CDS) market index as a proxy for the debt market and empirically tests its explanatory power in explaining stock return variations. Employing panel regression and Fama-MacBeth regression of all publicly traded U.S. companies from 2005 to 2020, the study finds a negative relationship between CDS index returns and stock returns. On average, a one standard deviation increase in CDS index return is associated with a 0.02% decrease in daily stock returns. Results of two-stage regressions show that the estimated systematic credit risk is positively priced in stock returns with similar economic magnitude as the well-documented beta risk. These results support asset pricing theories in the inclusion of debt claim and the risk-return tradeoff, while contradicting the credit risk puzzle documented in prior studies.

The economics of prepackaged bankruptcy

The economics of prepackaged bankruptcy

Banks’ risk taking and creditors’ bargaining power

We study the influence of unsecured debt (subordinated debt) on banks’ risk-taking in a contingent claim model where assets are risky debt claims. We consider the bargaining between stockholders and debtholders when choosing the level of asset risk. Replacing part of a bank's stock with subordinated debt leads to risk-shifting events occurring in a narrower domain of asset values (leverage ratios), but can lead to higher levels of risk, depending on the relative bargaining power. When side payments between the bank's claimholders are possible the inclusion of subordinated debt does not affect asset risk. Moreover, we show that severe, yet infrequent, regulatory corrective measures might have adverse effects on risk-shifting.

Making Money Amnesiac: The 1882 Making of Modern Negotiability in the United Kingdom

Drawing on microeconomic literature that highlights the convoluted links between memory, money, and information insensitive assets, this paper empirically explores the history and legal construction of modern negotiability in late nineteenth-century London. Taking a broader view, I argue that the 1882 Bill of Exchange Act (BoExA) was important in reengineering the money-memory nexus. This was achieved by reworking preexisting legal rules enabling transferability of bills of exchange around the holder in due course (HDC) doctrine. As a result of the superior legal protection of theHDC of a negotiable instrument, the need to inquire into any underlying credit risk was obviated. If the private debt claim was recognized as negotiable, the HDC was equallyrecognized as possessing the right to full recovery. This legal development complemented microstructural changes in the money market such as the emergence of the lender of last resort macropolicy in thecontext of a rising investment-oriented financial ecology.

Seeing Red: Indigenous Land, American Expansion, and the Political Economy of Plunder in North America

Michael John Witgen "concludes that the geographical expansion of the United States, especially in the northern Great Lakes homelands of the Anishinaabeg, depended not so much on military violence or even the immediate physical removal of Indigenous peoples. Rather, conquest was facilitated by a ‘political economy of plunder’ in which a coercive and duplicitous treaty process combined with the debt claims made by Indian agents, traders, and merchants to systematically separate Native nations from their land and annuity payments”

Behavior Paying Premium to the Independent Participants in Healthcare Social Insurance Administration Office

Premiums non-compliance leads to the Healthcare Social Insurance Administration Office (henceforth, will be referred to as BPJS Kesehatan) budget deficit, resulting in an accumulation of debt claims in various health facilities and an impact on the quality and quantity of health services in health facilities. As of March 2019, 38% of independent National Health Insurance (JKN) participants in Gorontalo City were not compliant to pay dues. This study objective to assess the relationship between willingness to pay with compliance behavior to pay premiums for BPJS Kesehatan independent participants. This study uses a cross-sectional study design. The population was 8,594 people who were independent BPJS Kesehatan participants with a sample of 95 people using accidental sampling techniques. Data were collected through interviews using a questionnaire, data analysis using Chi-Square test. The results showed that the distribution of the level of compliance paying BPJS premiums independently was still 64.2%. Distribution of the willingness to pay by 85%. There is a significant relationship between Willingness To Pay (WTP) with compliance paying dues with p = 0.031. There is a relationship between WTP with compliance to pay the premiums of BPJS Kesehatan independent participants in the inpatient installation at RSUD Prof. Dr. H. Aloei Saboe in Gorontalo City.

Tranching of debt as legal construction

This paper addresses a core feature of the debt capital markets in general and securitisation transactions in particular; the creation of debt claims with different ranking and priority (also referred to as “tranching”). The primary purpose of the study is to develop an understanding of the contractual ranking of debt as an enforceable legal construction. It is suggested that a more coherent understanding of tranching could foster (i) greater compatibility of insolvency law with financial regulation; (ii) a reduction in unnecessary transaction costs through further standardisation; and (iii) a more level playing field between jurisdictions and different forms of debt finance. I discuss tranching of debt in securitisations as one of many junctures between EU financial market regulation and the realm of local private law. At the same time, tranching highlights the elusive distinction between contracts that are valid and binding inter partes, and those that purport to affect third parties. These are vast topics, and even more daunting when taken together. The focus on securitisation and tranching therefore offers an opportunity to study fractions of these issues by virtue of the limited context. The paper is organised as follows. After an introduction of the subject matter and theoretical foundations, it investigates the element of tranching by first looking at the term as it emerges in the Securitisation Regulation ((EU) 2017/2402). It then looks at how the ranking of a tranche of debt securities plays into the rules on capital adequacy in a securitisation context. The notions of tranching found in financial regulation do not however include the substantive rules that apply to the creation of an enforceable priority ladder between investors. That task is still left to domestic insolvency, contract, and property law. Moving therefore beyond the definitions and usages of tranching in EU regulatory sources, the paper analyses how tranches of debt with different priority are created in actual transactions. Based on public transaction documents and domestic legal sources from three EU jurisdictions (France, Germany and the Netherlands) and the UK, it analyses the building blocks used to create enforceable contracts on the ranking of debt. This is followed by concluding remarks, including a suggested common approach for evaluating enforceability of an agreed payment waterfall across jurisdictions. By disentangling the elements of public STS transactions that are used to ensure enforceability of an agreed payment order, this study provides a starting point for finding paths in domestic law that allows legal certainty in relation to the ranking of notes.

The breach of contractual indemnities under English law – a debt claim or a damages claim?

In 2015 the English High Court delivered two important but not widely publicised judgments in the cases of ABM Amro Commercial Finance plc v Ambrose McGinn & others [2014] EWHC 1674 (Comm.) and Durley House Limited v Firmdale Hotels plc [2014] EWHC 2608 (Ch.). Febechi Chukwu reviews those judgments, and several previous rulings by the English courts, concluding that the lack of a single interpretive rule for contractual indemnities in English law is a preferable approach. The English courts should be clearer in accepting the complexity of properly interpreting indemnities and assessing the available remedies for breach. Ultimately that assessment is substantially dependant on how the indemnity in question is drafted and constructed in the contract. The courts should boldly promote the more nuanced approach to determining whether a particular breach gives the innocent party a right to a claim in debt or a claim in damages, and this will be of benefit also to practitioners negotiating indemnity clauses in English law contracts.

Exogenously Unsecured Creditors and the Pricing and Use of Secured Debt

We use litigation risk disclosures under Regulation S-K to investigate the effectiveness of covenants and security in protecting creditors from dilution from other creditors. We argue that covenants are less effective than collateral at protecting unsecured lenders from dilution arising from litigation and other non-debt related claims; claims we refer to as exogenously unsecured. Consistent with this argument we find that disclosures of litigation claims are associated with a significant increase in the spread between a firm’s secured and unsecured debt claims. More important, we find that the propensity of material litigation claims is negatively related to firms’ reliance on secured debt.

Banks’ Risk Dynamics and Distance to Default

Abstract We adapt structural models of default risk to take into account the special nature of bank assets. The usual assumption of lognormally distributed asset values is not appropriate for banks. Typical bank assets are risky debt claims with concave payoffs. Because of the payoff nonlinearity, bank asset volatility rises following negative shocks to borrower asset values. As a result, standard structural models with constant asset volatility can severely understate banks’ default risk in good times when asset values are high. Additionally, bank equity return volatility is much more sensitive to negative shocks to asset values than in standard structural models.

The risk spiral: The effects of bank capital and diversification on risk taking

We present a model where bank assets are a portfolio of risky debt claims and analyze stockholders' risk-taking behavior while considering the strategic interaction between debtors and creditors. We find that: (1) as the leverage of a bank increases, risk shifting by borrowers increases, even if their leverage is unchanged (zombie lending). (2) While the literature demonstrates that an increase in the comovement of a loan portfolio increases the bank's cost of default directly, we find that the increase in comovement causes an increase in risk shifting that further increases the cost of default (3) Risk shifting decreases with the diversification of a loan portfolio.

The Regulation Paradox of Initial Coin Offerings: A Case Study Approach

Compared to initial public offerings (IPOs) that are sales of company ownerships, and loans that are sales of debt claims, initial coin offerings (ICOs) are sales of promises of cryptocurrency appreciation. However, regulatory uncertainties continue to prohibit successful widespread adoption. This paper examines ICOs with varying levels of success, including Mastercoin (now Omni) and Kin, as well as fraudulent ICOs, like REcoin and OneCoin. The discussion of the benefits and flaws within the ICO market examines regulatory challenges concerning risks transferred to investors through information asymmetry, while questioning the ability of regulations to enhance investor protection mechanisms without undermining the fundamental value of cryptocurrencies and ICOs as a viable funding structure.

Banks Risk Taking and Creditors Bargaining Power

We analyze the influence of unsecured debt (subdebt) on risk-shifting in banks whose assets are risky debt claims. We assume that the stockholders and subdebt-holders jointly decide on risk-shifting. We show that replacing part of the stock with subdebt: (1) leads to fewer risk-shifting events, but can lead to higher levels of risk, depending on the relative bargaining power, (2) does not change the level of risk-shifting when side payments are possible, and (3) may yield the surprising result that risk-shifting increases with tighter regulatory control.

Bank Risk Dynamics and Distance to Default

We adapt structural models of default risk to take into account the special nature of bank assets. The usual assumption of log-normally distributed asset values is not appropriate for banks. Typical bank assets are risky debt claims, which implies that they embed a short put option on the borrowers' assets, leading to a concave payoff. This has important consequences for banks' risk dynamics and distance to default estimation. Due to the payoff non-linearity, bank asset volatility rises following negative shocks to borrower asset values. As a result, standard structural models in which the asset volatility is assumed to be constant can severely understate banks' default risk in good times when asset values are high. Bank equity payoffs resemble a mezzanine claim rather than a call option. Bank equity return volatility is therefore much more sensitive to big negative shocks to asset values than in standard structural models.

A Model of Endogenous Debt Maturity with Heterogeneous Beliefs

This paper studies optimal debt maturity in an economy with repayment enforcement frictions and investors disagree about repayment probabilities. The optimal debt maturity choice is a mix of long- and short-term debt securities. Spreading risky debt claims on cash flows over time allows debt to be priced by investors most willing to hold risk at each point in time, thereby increasing investment and output. By contrast, a single maturity, either all long- or short-term, will be priced by investors less willing to hold risk, which reduces investment and output. The model provides a novel explanation for the stylized fact that large and mature companies almost always issue debt with multiple maturities rather than a single maturity, and is broadly consistent with empirical debt maturity results. Lastly, we show that non-financial covenants that prevent debt dilution only serve as substitutes for short-term debt and do not affect real outcomes as they do not allow the firm to create additional collateral against which to borrow.

The Regulation Paradox of Initial Coin Offerings: A Case Study Approach

Compared to initial public offerings (IPOs) that are sales of company ownerships, and loans that are sales of debt claims, initial coin offerings (ICOs) are sales of promises of cryptocurrency appreciation. However, regulatory uncertainties continue to prohibit successful widespread adoption. This paper examines ICOs with varying levels of success, including Mastercoin (now Omni) and Kin, as well as fraudulent ICOs, like REcoin and OneCoin. The discussion of the benefits and flaws within the ICO market examines regulatory challenges concerning risks transferred to investors through information asymmetry, while questioning the ability of regulations to enhance investor protection mechanisms without undermining the fundamental value of cryptocurrencies and ICOs as a viable funding structure.

Case Note: Lenders’ Fees Not Linked to Loan Are Not Interest Income

This case note sets out the ruling by the Authority for Advance Rulings in Societe De Promotion Et De Participation Pour La Cooperation Economique that an appraisal front-end fee charged by the taxpayer to its client borrowers was not taxable in India as interest because it was not linked to the loan and not payable if the loan was not approved. However, all other fees (i.e. non-appraisal front-end fees, commitment fees, cancellation fees, monitoring fees and amendment fees) were taxable in India as interest income in terms of article 12(4) of the France-India Income and Capital Tax Treaty (1992) because they were payable only after the debt claim came into existence.