Credit risk assessment and competition: analysis of the impact of credit scoring and securitization on banks' strategies.

Summary This thesis focuses on two major financial innovations that have occurred in the banking sector in recent decades: securitization and credit scoring. More specifically, we propose three theoretical analyses concerning i) the link between the generalization of the use of these tools and the intensification of banking competition. ii) the impact of the use of these tools on the information production function of banks (monitoring and screening). The main results of this work are as follows: 1) The principle of competition does not guarantee the adoption of the most efficient technology when two banks, differentiated according to their credit granting technology, lending relationship or credit scoring, compete twice in both the credit and deposit markets. 2) Banks can use loan assignment to avoid revealing private information that they may have collected on their customers through the customer relationship when the possession of private information is likely to provide a future competitive advantage in the context of intertemporal competition . 3) Securitization can be used strategically to mitigate competition in the credit market. Specifically, securitization can be used by a bank as a means of signaling to its competitors that it will reduce the intensity of its monitoring in order to mitigate the adverse selection problem they face. By doing so, banks manage to increase their overall profit, but at the expense of market efficiency.