Table 7.

Summary of credit risk indicators and significance

IndicatorType of indicatorDescriptionF-statisticStatistical significance (p-value)
AltmanZAccounting-basedMeasures financial health using profitability, leverage, liquidity and efficiency19.35<0.001
1yrDDMarket-basedDistance from insolvency threshold based on asset volatility and market value7.35<0.001
1yrPDMarket-basedModel-estimated probability of default over the next year2.210.1104
CDSMarket-basedReflects market-perceived credit risk through cost of insuring debt3.430.0329
Source(s): Created by authors

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