Default risk in project finance

R. Klompjan, Marc Wouters

    Research output: Contribution to journalArticleProfessional

    Abstract

    Understanding default risk in project finance is relevant to investors. This article investigates which factors are most strongly associated with the occurrence of project finance default, using data from 210 projects, of which 37 were in default. The authors found that the use of proven technology, a sponsor with experience, a high debt service coverage ratio, and the absence of commercial risk cover are associated with lower default risk. The article also provides further insights into the relationships among the factors associated with default risk, and it discusses managerial implications for managing project finance default risk. - See more at: http://www.iijournals.com/doi/abs/10.3905/jsf.2002.320283#sthash.RRRTtHlC.dpuf
    Original languageEnglish
    Pages (from-to)10-21
    Number of pages12
    JournalJournal of structured finance
    Volume8
    Issue number3
    DOIs
    Publication statusPublished - 2002

    Fingerprint

    Default risk
    Project finance
    Factors
    Sponsor
    Managing projects
    Debt
    Investors

    Keywords

    • METIS-207224

    Cite this

    Klompjan, R. ; Wouters, Marc. / Default risk in project finance. In: Journal of structured finance. 2002 ; Vol. 8, No. 3. pp. 10-21.
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    Default risk in project finance. / Klompjan, R.; Wouters, Marc.

    In: Journal of structured finance, Vol. 8, No. 3, 2002, p. 10-21.

    Research output: Contribution to journalArticleProfessional

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