Development and Evaluation of a Credit Scoring Model for the Farm Credit System

Credit scoring models were developed to identify the credit risk in term and operating loans for the principal purposes of evaluating portfolio quality and monitoring risk at the loan and portfolio levels in the Farm Credit System. Experience based (lender) and statistical (academic) approaches were used jointly. Initially, experience term and operating loan models were developed, utilizing financial ratios from the Farm Financial Standards Task Force (FFSTF) as the explanatory variable measures. Then, logit regression was employed to estimate term and operating loan models, utilizing classifications and variable measures from the experience models as the dependent and independent variables, respectively. The procedure compared the experience model and statistical model on the basis of the variable measures and classifications, and the FFSTF measures were evaluated with respect to their applicability in credit scoring models. Results from the experience and Logit models' applications indicated similarity in the variable measures selected and classifications, and indicated that the FFSTF measures were appropriate in the models.

Name thesis:degree_name

Ph.D.

Level thesis:degree_level

Dissertation

Discipline thesis:degree_discipline

Agricultural Economics

Grantor

University of Illinois at Urbana-Champaign

Year dc:date

2014

Author dc:creator

• Splett, Nathan S.

Contributors dc:contributor

• Barry, Peter J.

• Economics, Agricultural
• Business Administration, Banking

Identifier

(UMI)AAI9329165

OAI identifier oai:identifier

oai:www.ideals.illinois.edu:2142/72177