Unsecured Credit Supply over the Credit Cycle: Evidence from Credit Card Mailings

Topic: Unsecured Credit Supply over the Credit Cycle: Evidence from Credit Card Mailings

Speaker: Song Han, Board of Governors of the Federal Reserve System

Date: July 4, 2013 (Thu.)

Time: 13:00-14:30

Location: Building 4, Room 101

Language: English

Abstract: Using a unique dataset of credit card mailings, we show that during the recent credit boom, consumers with mediocre credit scores received more credit card solicitations than those with high credit scores. However, this relationship reversed after the financial crisis. We also find that consumers with a bankruptcy history, a conspicuous signal of higher default risk, were not excluded from the credit market, but received fewerless-favorable offers, especially as they approach being eligible for re-filing. These disparities deepened in the wake of the credit bustwidened further after the implementation of the CARD Act.

About the speaker: Dr. Song Han is currently the ChiefSenior Economist in the Short-Term Funding Markets Section at Board of Governors of the Federal Reserve System. Before he joined the Federal Reserve Board in 2001, he had been a Visiting Assistant Professor in the University of RochesterUniversity of Mississippi. Dr. Han received his Ph.D. in Economics from the University of Chicago in 1998B.A. in Economics from People’s University of China in 1990. Dr. Han’s research interests focus on Corporate Bonds, Market Microstructure, Consumer Finance, StateLocal Government Finance, Financial DistressBankruptcy Laws. He has published in Journal of Money, CreditBanking, Journal of Financial Services Research, Management Science, Journal of Real Estate FinanceEconomicsother academic leading journals.