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A Comparative Study on Credit Risk Assesment of Enterprises In Turkey

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  • Olcay Erdogan
  • Zafer Konakli
  • Adnan Hodzic

Abstract

Credit risk prediction models attempt to predict whether a business will experience to be in a level of investment, speculative or below investment. The purpose of this paper is to propose an alternative model for predicting failure. The constructed credit rating model was on a sample data that consists of financial ratios from 356 enterprises that are listed on the Istanbul Stock Exchange. The data covers observations running from the first quarter of 2014 to the end of year. We have classified 356 enterprises into three levels using 18 parameters for each. The applied methods are discriminant analysis and Adaptive Neuro Fuzzy Inference Systems (ANFIS). The study supports building a balanced financial environment and help to determine the firms which are appropriate for credit loan.

Suggested Citation

  • Olcay Erdogan & Zafer Konakli & Adnan Hodzic, 2016. "A Comparative Study on Credit Risk Assesment of Enterprises In Turkey," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 6(11), pages 542-555, November.
    • Handle: RePEc:hur:ijarbs:v:6:y:2016:i:11:p:542-555
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    References listed on IDEAS

    as
    1. Deakin, Eb, 1972. "Discriminant Analysis Of Predictors Of Business Failure," Journal of Accounting Research, Wiley Blackwell, vol. 10(1), pages 167-179.
    2. Edward I. Altman, 1968. "Financial Ratios, Discriminant Analysis And The Prediction Of Corporate Bankruptcy," Journal of Finance, American Finance Association, vol. 23(4), pages 589-609, September.
    3. Edward I. Altman, 1968. "The Prediction Of Corporate Bankruptcy: A Discriminant Analysis," Journal of Finance, American Finance Association, vol. 23(1), pages 193-194, March.
    4. Ohlson, Ja, 1980. "Financial Ratios And The Probabilistic Prediction Of Bankruptcy," Journal of Accounting Research, Wiley Blackwell, vol. 18(1), pages 109-131.
    Full references (including those not matched with items on IDEAS)

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