Risk of Network Insolvency

Abstract

The general conclusions about networks and business combinations in this chapter are related to the assessment of creditworthiness according to the principles of Basel, both in the current formulation and in the third revision (De Laurentis and Caselli, 2006; De Laurentis and Maino, 2010; Quattrociocchi, 2012b). The adoption of methodologies to calculate the rating has forced companies to redefine the policy and the conditions of financial/economic/balance stability also for the current economic cyclical scene (Murè, 2010). In particular, the introduction of Basel II has made it necessary to reconsider the models for analyzing and managing credit risk. In some cases, a reduction in faith in the reliability to businesses, especially smaller ones, of the use of balance data and automated analysis, or the anchoring of creditworthiness assessment to hard variables (Cowan and Cowan, 2006), rather than soft (Brunner et al., 2000; Grunert et al., 2005; Cattaneo et al., 2012), has sparked a chain reaction, begun during periods of tighter credit but also exacerbated by the financial crisis (Iannuzzi et al., 2011). In some cases there has been a short circuit of the bank-enterprise relationship, involving depersonalization, which has overshadowed the ability to assess intangible factors related to the entrepreneur, the history of the company, and the competitive environment (Paravani, 2006).