NHH Brage (Norges Handelshøyskole)
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Understanding credit risk in Norwegian real estate crowdlending : Analysis of credit quality among Norwegian real estate crowdlending borrowers across FundingPartner, Kameo and Monio
Get PDFThe Norwegian crowdlending industry has grown rapidly in the last decade, resulting in the emergence of several platforms of notable sizes. Regulations are lagging, and government instances are discussing incorporating EU directives. This thesis aims to investigate risk differences in credit classifications across Norwegian crowdlending platforms. We identify risk factors and analyze potential differences in risk related to loans issued by FundingPartner, Kameo and Monio. We analyzed differences both for the platforms overall and within the credit classifications. The results provide an overview of differences in credit assessment that may benefit the decisions of both lenders and policymakers.
The analysis is based on a manually assembled data set containing loan data, financial statements and policy rates. Our empirical analysis uses three bankruptcy models to evaluate borrowers' credit risk based on financial statements. The results from the bankruptcy models are tested to ensure significance. Moreover, we integrate project-specific risk elements such as collateral, loan size, loan term and interest rates to explain the differences we discovered. We also consider actual default rates and check if they are consistent with our empirical results.
Despite having equal credit classification, we discovered significant differences between borrowers of such loans. FundingPartner issued A-classified loans with significantly riskier borrowers than Monio, despite Monio rewarding their lenders with higher interest rates. Borrowers of Monio are overall the least risky, yet the platform hosts the riskiest borrowers in our sample. Kameo borrowers with D-classified loans are significantly less risky than Monio's. Furthermore, we observe considerable differences in the use of collateral to secure lenders in the event of default. Lastly, we compare our empirical findings against confirmed defaults.nhhma
Exploring the deployment of autonomous medical emergency vessels in island and coastal regions : An overview of the opportunities and challenges
Get PDFIntroduction: Applications of vessels in emergency medical systems: Method: Discussion: Conclusion: Emergency medical systems in island and coastal regions face challenges
such as supply and staffing shortages and a dispersion of resources and people, which
negatively affect the timely and efficient delivery of emergency medical services. This thesis
explores the opportunities and challenges of using autonomous vessels in these systems to
start a discussion, as current research in this area is very limited.
Currently, emergency vessels are
primarily used to transfer patients to hospitals, doctors to emergency sites as well as
equipment between islands. Floating hospitals ships generally combine these functions by
enable comprehensive consultation, diagnosis, and treatment at the emergency sites.
Additionally, rescue and search operations can also be counted among the tasks of
emergency medical systems if one considers an extended range of tasks for these systems.
The location of hub facilities, where autonomous vessels are stationed when not in
operation, is one of the first decisions to be made when integrating those vessels into current
emergency systems. Therefore, the model for solving the maximal covering location
problem is applied and adjusted to cover a wider range of application of vessels in
emergency medical systems. Simulations are conducted to identify opportunities to improve
system performance when setting hub facilities for autonomous vessels.
Hub facilities for autonomous vessels can be located at a greater number of
locations, leading to better population coverage in some cases. Furthermore, the complexity
of response routes can be decreased by the ability of autonomous vessels to transform
current applications of vessels in emergency medical systems. Despite several other
opportunities to reduce response times and use resources more efficiently, there are also
challenges associated with the use of autonomous vessels. Some main challenges are to
successfully integrate the new vessels into the existing system and to ensure their use by the
population. Additionally, the costs of autonomous vessels are likely to exceed those of
conventional vessels requiring in-depth cost-benefit considerations.
Autonomous vessels have a great potential to enhance the performance of
emergency medical systems in island and coastal regions. Most of the challenges can be
mitigated by carefully planning their operations and introduction of the vessels into the
existing system. However, in the context of scarce funding, higher costs compared to
conventional vessels are likely to be the most significant challenge for the introduction of
autonomous vessels.nhhma
Effekten av irrelevant informasjon og bevisstgjøring i en fortsatt-drift vurdering : En eksperimentell studie
Get PDFRevisjon utgjør en kritisk prosess for å sikre pålitelighet og integritet i finansiell informasjon.
Revisorer evaluerer betydelige mengder informasjon for å kunne fremsette en uavhengig
vurdering av et selskaps økonomiske situasjon. Tidligere forskning har avdekket et fenomen
kjent som «dilution effect». Dette fenomenet innebærer at beslutningstakere tillegger vekt til
informasjon, selv om den er irrelevant for den aktuelle beslutningen som skal fattes. Dette kan
representere en utfordring i revisjonskontekst, der revisorer mottar både relevant og irrelevant
informasjon i løpet av revisjonsprosessen, men skal trekke slutninger basert utelukkende på
relevant informasjon. Flere faktorer som kan påvirke «dilution effect» har blitt undersøkt, en
av disse er bevisstgjøring.
I denne studien undersøkes det om aktiv bevisstgjøring av hva som er relevant og ikke-relevant
informasjon reduserer «dilution effect». Studien er utført på 55 deltagere, bestående av
revisorer og studenter innen revisjon. Deltagerne har sett på en fortsatt-drift vurdering.
Deltagerne ble delt i tre grupper. Gruppe 1 er kontrollgruppe og fikk kun relevant informasjon.
Gruppe 2 fikk både relevant og ikke-relevant informasjon. Gruppe 3 fikk i tillegg til samme
informasjon som gruppe to, beskjed om å sortere mellom relevant og ikke-relevant
informasjon før sin vurdering.
Studien fant ikke bevis for at revisors vurdering er påvirket av «dilution effect». Dette utgjør
ikke et belegg for at fenomenet ikke forekommer. Årsaken kan være at populasjonen var for
liten til å statistisk påvise «dilution effekt». Utvalget bestod også av en stor andel revisorer
med fire eller flere års erfaring, hvilket kan ha redusert effekten. Studien fant heller ikke bevis
for at «bevisstgjøring» har en effekt på «dilution effect». Da det ikke ble påvist «dilution
effect» måtte eventuelle signifikante forskjeller i vurderingene vært knyttet til andre faktorer.nhhma
Exploring the Economics of Sustainable Energy : A Comparative Analysis of LCOE and System Costs for Nuclear and Offshore Wind Projects in Norway
Get PDFThis study explores the impact of input factor variability and the scope of analysis on profitability
calculations for nuclear and offshore wind power in the Norwegian power market. The research
employs several data sources and combines LCOE calculations and Monte Carlo simulations to assess
the impact of uncertain factors on profitability estimations. Additionally, regression analyses assess
the relationship between the share of the different power technologies and balancing volumes in a
system. Additionally, a comprehensive discussion on system costs is included to encompass the
system cost concept fully.
The study's main findings include that the LCOE of offshore wind projects primarily relies on the
discount rate and capacity factor. On the other hand, a potential SMR project would be impacted
mainly by CAPEX and OPEX. Additionally, we find that LCOE has two significant limitations. First,
the metric fails to account for the value of longevity in power production, which contradicts long-term
supply and environmental objectives. Secondly, it does not count for system costs occurring beyond
the scope of the project. This makes the validity and significance of the LCOE metric vary among
different stakeholder groups.
Another important finding is a significant but low correlation between the penetration of the different
power sources and balancing volumes. While an increase in wind power penetration level is
associated with an increase in imbalance volumes, the opposite effect is observed when studying the
relationship with nuclear power. This could have important implications for the total costs of
electricity production and suggests that a holistic approach is essential for informed decision-making
regarding the future Norwegian energy mix.nhhma
Determinants of Capital Structure: A Cross-Country Analysis : An empirical analysis on determinants of capital structure in listed firms across the G7 countries
Get PDFThis study aims to investigate how firms operating in different institutional, regulatory, economic and cultural settings determine their capital structure in the period 2012 to 2019. As previous research commonly limits their analysis to a singular country or industry, this thesis emphasises why and how determinants of capital structure may differ between countries. I analysed firms' capital structure across the G7 countries through the lens of the trade-off theory, the information asymmetry theory, and the market timing theory.
Using Debt-to-Capital as the dependent variable measured individually by book values and market values, I identify seven firm-specific factors that reliably determine capital structure across the G7 countries using the fixed effects estimation model and robust standard-errors: tangibility (+), market-to-book ratio (-), size (+), profitability (-), liquidity (-), Altman’s Z-score or probability of bankruptcy (-), and industry median leverage (+). Furthermore, while demonstrating varying levels of significance across the sample countries, five additional factors were observed as reasonable determinants of capital structure: non-debt tax shields (+), term spread (+/-), corporate taxation rate (-), revenue volatility (+/-), and lagged leverage (+). The effectualness of these variables is observed to deviate between countries, thereby suggesting a firm’s capital structure is heavily influenced by its environment. I argue the cross-country differences in determinants of capital structure originate due to differing economic and institutional development and stability, tax codes and insolvency laws, corporate culture, and exposure to capital markets.nhhma
A Story About Digitalization and Those Left Out : A quantitative study exploring the effect of digitalization on web accessibility.
Get PDFThis thesis examines the influence of digitalization on web accessibility for people with
disabilities (PwD). The central research question addressed is: "How does digitalization
affect web accessibility for people with disabilities?" The hypothesis proposed in this study
is that web accessibility decreases as digitalization advances, irrespective of legislation and
awareness regarding the accessibility gap. The hypothesis is grounded in the observation that
visual aspects are prioritized during web development, potentially overlooking the
importance of web accessibility. This is an important topic of research since nearly 20% of
the world's population (World Health Organization 2023), have a disability and almost
everyone will experience disability at some point in their life (World Health Organization
n.d.).
Utilizing quantitative methods to conduct an empirical test this research evaluated the web
accessibility of 49 Canadian Universities over a 15-year time period, from 2008 to 2022.
Data collection utilized online sources such as the Wayback Machine.
The research findings reveal that during periods of web advancements, there is an initial
increase in web accessibility issues, validating the negative impact of digitalization on web
accessibility. However, over time, there is a noticeable reduction in these issues, indicating
an overall improvement in web accessibility. One significant factor negatively impacting
web accessibility identified in this study is, the visual advancements brought about by
digitalization. The effectiveness of legislation in enhancing web accessibility was
investigated, focusing on compliance deadlines. The study demonstrates that compliance
deadlines do not lead to increased accessibility on the web, meaning legislation fails to
effectively improve web accessibility.
Overall, this research highlights the immediate inaccessibility of the web resulting from
digitalization. These findings emphasize the ongoing need to prioritize web accessibility
amidst digital advancements. From these findings, stakeholders can work towards a more
inclusive and accessible web environment for PwD.nhhma
Do Shipping Freight Rates Predict Stock Market Returns? An Empirical Study of the Relationship between Shipping Freight Rates and Broad Stock Market Returns
Get PDFGiven the availability and real-time inference of shipping freight rates, they are often
regarded as a gauge for the economy. Stock market commentators and participants
often stress the importance of falling freight rates as a leading indicator of recession.
This thesis investigate the relationship between shipping freight rates and stock market
returns, to determine whether the former can predict the latter. Using a time series
from 2000-2022, we find that an index for dry bulk freight rates significantly predicts the
broad MSCI World, OSEBX, S&P500, and STOXX600 indices, with the most substantial
predictability observed at a one-month lag. Our findings suggest that this predictability
is not due to time-varying risk premium, thus challenging the efficient market hypothesis.
Additionally, we find a feedback relationship between dry bulk freight rates and stock
market returns, meaning that they both are helpful in predicting each other at different
periods in time. Therefore we suggests complexity in the relationship that warrants further
research. Furthermore, increasing dry bulk rates coincides with reduced stock market
volatility. Moreover, we conclude that the relationship between dry bulk freight rates and
stock market returns is time-varying and correlations becomes stronger during periods of
financial uncertainty. The sign of the relationship during crisis periods depends on the
behavior of supply and demand curves for shipping capacity before and during a shock.
Our research enlightens shipping freight rates ability to predict stock market returns,
offering valuable insights for investors, policymakers, and academics alike.nhhma
Survival of the Fittest? An empirical analysis of spillover effects following M&A announcements in the Norwegian stock market
Get PDFThis thesis aims to add to the difficult issue of announcement returns in rivals of acquisition
targets. As existing M&A literature has predominantly focused on the acquirer, the target, and
the merged entity, much remains to be known about the competitive effects of merger activity.
Accordingly, our research may help challenge the widespread perception among regulators that
being a merger outsider represents a competitive threat. We aim to add to the ongoing
investigation of rival returns by examining announcement returns in rivals of Norwegian
acquisition targets. Specifically, we investigate if several non-researched deal-specific and firmspecific
variables can help explain sources of rival gains following acquisition announcements.
Using a sample of 163 acquisition announcements and 987 rival firms in Norway between 1995-
2020, we find that, on average, rivals of Norwegian acquisition targets experience positive
announcement returns. We hypothesize that in acquisitions where the acquirer and target are
competitors, rivals will gain less than rivals where they are not. This is because horizontal
transactions are more likely to negatively impact rival firms' future cash flows. Our findings
confirm our hypothesis, as rivals, on average, gain less when the transaction is horizontal.
Moreover, we find that rival returns increase when the acquirer is foreign and when the bid
surprises the market. Both are likely due to positive signalling effects such as increased industry
growth expectations or a greater probability that the rival will become a subsequent target.
Furthermore, we investigate if concerns of increased competition can explain the lower
announcement returns in horizontal acquisitions. Using market share and EBITDA margin as
proxies for the competitive position of rivals, we test if they impact rival returns differently in
horizontal and nonhorizontal acquisitions. We find that a higher market share correlates with
higher announcement returns in horizontal acquisitions but not in the total sample. This
coincides with our theory that investors prefer investing in rivals with solid competitive positions
following intra-industry mergers but smaller targets after nonhorizontal transactions. However,
the EBITDA margin does not impact the subsamples differently. Thus, we cannot conclude that
competitive concerns drive down rival returns in horizontal acquisitions. Finally, the extant
literature neglects the link between rival returns and ownership structure, despite corporate
finance making strong predictions between target returns and ownership structure. We aim to
add to this loophole in the literature by including four proxies capturing the ownership
concentration of rival firms in our analysis. However, we find no evidence that ownership
structure impacts rival announcement returns.nhhma
Mowi ASA : Strategic Analysis
Get PDFThis master’s thesis has conducted a strategic review of the salmon farming company Mowi
ASA. The main objectives of the thesis are to explore Mowi’s origin and history from a
financial and strategic perspective, the challenges and opportunities that the company faces
today, and a presentation of how the company can make good strategic decisions going
forward to address these. The thesis consists of six chapters, where Chapter 1 describes how
Mowi started with three pioneers in their backyard to become the largest Atlantic salmon
farming company in the world.
Chapter 2 examines Mowi’s fully integrated value chain and introduces industry
characteristics. The chapter aims to provide useful insights into the technicalities of how
salmon is produced, key factors that salmon farmers must consider, and Mowi’s position. In
Chapter 3, we dive into Mowi’s financial situation with a particular focus on the company’s
profitability, setting the basis for our subsequent analysis and discussions around Mowi's
strategic positioning going forward.
In Chapter 4, we compare Mowi’s position and profitability to competitors at Mowi’s various
farming locations globally, with a particular focus on regions in Norway. Throughout the
competitor analysis, the goal is to discover the causes behind the differences in profitability
and how Mowi can improve in each area. The recently announced resource rent tax on
Norwegian salmon farming operations has gained serious attention in the media. Norwegian
salmon farmers are highly concerned about the impact of the resource rent tax on their
operations. In Chapter, 5 we introduce the proposed resource rent tax and analyse its impact
on Mowi’s Norwegian farming operations.
Finally, Mowi’s alternative strategic measures are discussed in Chapter 6. Our first
recommendation for Mowi is to prioritize further investments and growth in Scotland. In
addition, Mowi should strive to improve its operations in Norway, as Norway will constitute
a significant portion of Mowi’s business in the future despite the resource rent tax. Our last
recommendation for Mowi is to improve its presence and performance within the feed
segment, which will be less affected by the resource rent tax than the farming segment.nhhma