Analysis of probability of financial loss in legal proceedings
Keywords:
Probability. Financial Loss. Financial Institutions. Provision. Jurimetrics.Abstract
The aim of this paper is to estimate the probability of financial loss in a lawsuit, based on variables obtained by the jurimetric analysis of the lawsuits. The database was extracted from a system used by a Brazilian financial institution to monitor the lawsuits, as required by regulatory bodies. By means of logistic regressions, it was possible to identify that the variables related to the place of proceedings, the claims and the time are statistically significant at 1% and 5%, influencing the dependent variable of financial loss. The model also contributes to estimating the probability of financial loss in legal proceedings, helping to estimate the provision, in line with the prescriptions of regulatory bodies. The findings are useful to managers and agents of the national financial system.
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