Polish household default risk and physical risk of climate change
This paper aims to assess the level of credit risk (from the perspective of default risk) among Polish households associated with the physical risks of climate change. In order to determine the potential impact of the physical risk of climate change on household credit risk, we conducted CAWI interv...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Sciendo
2023-09-01
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| Series: | Financial Internet Quarterly |
| Subjects: | |
| Online Access: | https://doi.org/10.2478/fiqf-2023-0021 |
| _version_ | 1797661016321949696 |
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| author | Kurowski Łukasz Sokal Katarzyna |
| author_facet | Kurowski Łukasz Sokal Katarzyna |
| author_sort | Kurowski Łukasz |
| collection | DOAJ |
| description | This paper aims to assess the level of credit risk (from the perspective of default risk) among Polish households associated with the physical risks of climate change. In order to determine the potential impact of the physical risk of climate change on household credit risk, we conducted CAWI interviews with 1,006 borrowers residing in different Polish voivodeships (to account for heterogeneity of credit exposures to extreme weather events). According to these respondents, wildfires and storms in Poland are the greatest source of physical risk of climate change. In the event of a wildfire or storm, approximately 13% of borrowers would not be able to repay their loans while not being insured, which potentially increases banks’ credit risk and exposes banks to losses. However, we find that households underestimate the credit risk that could arise from a drought. |
| first_indexed | 2024-03-11T18:38:19Z |
| format | Article |
| id | doaj.art-e6d2dfb17c1a4875ad84d42ac6a8fd2a |
| institution | Directory Open Access Journal |
| issn | 2719-3454 |
| language | English |
| last_indexed | 2024-03-11T18:38:19Z |
| publishDate | 2023-09-01 |
| publisher | Sciendo |
| record_format | Article |
| series | Financial Internet Quarterly |
| spelling | doaj.art-e6d2dfb17c1a4875ad84d42ac6a8fd2a2023-10-12T14:08:21ZengSciendoFinancial Internet Quarterly2719-34542023-09-01193879910.2478/fiqf-2023-0021Polish household default risk and physical risk of climate changeKurowski Łukasz0Sokal Katarzyna11Warsaw School of Economics2Warsaw School of EconomicsThis paper aims to assess the level of credit risk (from the perspective of default risk) among Polish households associated with the physical risks of climate change. In order to determine the potential impact of the physical risk of climate change on household credit risk, we conducted CAWI interviews with 1,006 borrowers residing in different Polish voivodeships (to account for heterogeneity of credit exposures to extreme weather events). According to these respondents, wildfires and storms in Poland are the greatest source of physical risk of climate change. In the event of a wildfire or storm, approximately 13% of borrowers would not be able to repay their loans while not being insured, which potentially increases banks’ credit risk and exposes banks to losses. However, we find that households underestimate the credit risk that could arise from a drought.https://doi.org/10.2478/fiqf-2023-0021physical riskcredit riskhousehold debtextreme weatherg21g28 |
| spellingShingle | Kurowski Łukasz Sokal Katarzyna Polish household default risk and physical risk of climate change Financial Internet Quarterly physical risk credit risk household debt extreme weather g21 g28 |
| title | Polish household default risk and physical risk of climate change |
| title_full | Polish household default risk and physical risk of climate change |
| title_fullStr | Polish household default risk and physical risk of climate change |
| title_full_unstemmed | Polish household default risk and physical risk of climate change |
| title_short | Polish household default risk and physical risk of climate change |
| title_sort | polish household default risk and physical risk of climate change |
| topic | physical risk credit risk household debt extreme weather g21 g28 |
| url | https://doi.org/10.2478/fiqf-2023-0021 |
| work_keys_str_mv | AT kurowskiłukasz polishhouseholddefaultriskandphysicalriskofclimatechange AT sokalkatarzyna polishhouseholddefaultriskandphysicalriskofclimatechange |