# kaal:claim:3405660-036

**Claim.** The internal ratings based approach reduces information asymmetry because internal ratings capture supplementary borrower information that external credit assessors cannot reach and cover a broader range of borrowers.

**Type.** mechanism  **Support.** argued

**Holds when.**

- banks use the internal ratings based approach

**Source quote.**

> internal ratings may incorporate supplementary information about borrowers that is usually beyond the reach of institutions providing external credit assessments, and may cover a much broader range of borrowers

**From.** Kaal, *Indirect Regulation of Hedge Funds* (2019), V. Conclusion, page 26

**Cite as.** Kaal, Indirect Regulation of Hedge Funds (2019). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3405660

**Verify.** sha256 of source PDF `cf507b1833071765bc13a5605f38c2591582eca85f40869e38b6ff075c04d29d` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202019%20-%20Indirect%20Regulation%20of%20Hedge%20Funds.pdf

**Topics.** disclosure, risk-and-incentives, systemic-risk

**Keywords.** internal-ratings-based-approach, information-asymmetry, credit-risk, basel-framework

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.