Bank Liquidity and the New Doctrine of Anticipated Income

Credit risk management and deposit money banks’ profitability in Nigeria: A panel data regression approach

“…Anticipated income theory was propounded by Prochnow (1949), and it postulates that banks should abandon the erstwhile self-liquidating commercial loan doctrine and term length (i.e., short-, medium-and long-term) loans as well as non-business loans because the 'real bill' is repaid from the future earnings of the borrower (anticipated income). If this is considered as the true source of bank loan repayment, it stands to reason that bank lending should not be restricted to the traditional commercial loan theory; the important issue in bank lending is the borrower's ability to repay the loan, and their future income constitutes the source for that.…”

A model-based approach for estimation of liquidity risk of joint-stock commercial banks in Vietnam

“…Theo Prochnow 17 đề xuất "Lý thuyết thu nhập dự kiến" cho rằng các khoản thu nhập từ tài sản không chỉ xảy ra khi tài sản đến hạn mà còn có được vào nhiều thời điểm khác trong suốt thời hạn của tài sản. Lý thuyết này đã đặt nền tảng quan trọng cho việc nghiên cứu cấu trúc kỳ hạn của tài sản, và thu nhập dự kiến của tài sản được xem như một biện pháp đảm bảo thanh khoản.…”

Relation between Liquidity and Profitability of Nabil Bank and Everest Bank Limited

“…Here the liquidity can be planned if the scheduled loan payments by a customer are based on the future of the borrower. The doctrine of anticipated income, as formalized by Prochnow (1949), embodied these ideas and equated intrinsic soundness of term loans, which were of growing importance, with appropriate repayment schedules adapted to the anticipated income or cash flow of the borrower. The theory emphasizes the earning potential and the credit worthiness of a borrower as the ultimate guarantee for ensuring adequate liquidity.…”