On This PageVol. 12, No. 2

Loan sales have little effect on bank risk
Last Updated: 03/07/88
This paper analyzes three reasons for loan sales-funding, diversification, and capital requirements- by empirically testing their relevance to and their implications for bank risk. That is, we test whether banks actually do sell loans for each of those three reasons, and whether selling loans, in each of the three cases, affects bank risk.