caa a22 4500 445877820 CHVBK 20180317145533.0 cr unu---uuuuu 170323e20110901xx s 000 0 eng 10.1007/s11187-009-9236-0 doi (NATIONALLICENCE)springer-10.1007/s11187-009-9236-0 Evaluating guarantee fees for loans to small and medium-sized enterprises [Elektronische Daten] [Chau-Jung Kuo, Chin-Ming Chen, Chao-Hsien Sung] Governments all over the world regard loan guarantee schemes (LGS) as one of the most regularly used and relatively effective mechanisms to support small and medium-sized enterprises (SMEs) financially by facilitating their access to debt capital. Due to its nature of involving implicit indirect subsidization, a LGS is mostly evaluated in terms of the economic and social benefits created, such as generation of export revenues and creation of employment opportunities. Although most government-sponsored programs do not set up clear-cut definitions for how to evaluate those benefits and what targets should be achieved, they do have an initial aim of self-financing. Since guarantee fees (premiums) represent the largest cash inflow for a guarantor and the most critical index to indicate a borrower's credit status, this paper proposes a methodology that specifically aims for this self-financing target by meeting at least default costs with income from premiums. This is done by actuarially determining a guarantee fee for each loan based on market-based information and risk-neutrality concepts. Empirical evidence shows that real cash outflows (costs of honoring defaults) are very close to estimated cash inflows (total guarantee fees), which indicates that the objective of meeting budget constraints is achieved. Springer Science+Business Media, LLC., 2009 Credit guarantee nationallicence Market-based nationallicence Risk neutral nationallicence Actuarial pricing theory nationallicence Kuo Chau-Jung Department of Finance, National Sun Yat-sen University, Kaohsiung, Taiwan, ROC aut Chen Chin-Ming Department of Money and Banking, National Kaohsiung First University of Science and Technology, Kaohsiung, Taiwan, ROC aut Sung Chao-Hsien Department of Finance, National Sun Yat-sen University, Kaohsiung, Taiwan, ROC aut Small Business Economics Springer US; http://www.springer-ny.com 37/2(2011-09-01), 205-218 0921-898X 37:2<205 2011 37 11187 https://doi.org/10.1007/s11187-009-9236-0 text/html Onlinezugriff via DOI 1 research-article jats NATIONALLICENCE 856 40 https://doi.org/10.1007/s11187-009-9236-0 text/html Onlinezugriff via DOI NATIONALLICENCE 700 1- Kuo Chau-Jung Department of Finance, National Sun Yat-sen University, Kaohsiung, Taiwan, ROC aut NATIONALLICENCE 700 1- Chen Chin-Ming Department of Money and Banking, National Kaohsiung First University of Science and Technology, Kaohsiung, Taiwan, ROC aut NATIONALLICENCE 700 1- Sung Chao-Hsien Department of Finance, National Sun Yat-sen University, Kaohsiung, Taiwan, ROC aut NATIONALLICENCE 773 0- Small Business Economics Springer US; http://www.springer-ny.com 37/2(2011-09-01), 205-218 0921-898X 37:2<205 2011 37 11187 Metadata rights reserved Springer special CC-BY-NC licence nationallicence BK010053 XK010053 XK010000 NATIONALLICENCE NATIONALLICENCE NL-springer