Credit Tools & Solutions

In the credit risk measurement and management space there are many tools which aim to address:

  • Default probability (PD)
  • Rating estimation
  • Loss Given Default (LGD) or Recovery
  • Correlations in portfolios and securitizations
  • Portfolio analytics, economic capital, return on risk capital
  • Credit work flow
  • Data collection
  • Credit education

For best practices and regulatory reasons these tools must be made specific to asset classes such as:

  • Retail (consumer) exposures
  • Small business
  • Middle market
  • Corporate (wholesale) counterparties

The solutions must also be specific to counterparty industries, including:

  • Banks
  • Insurance companies
  • Asset managers
  • Brokerages
  • Hedge funds
  • Energy traders
  • Industrial firms
  • Sovereign entities including municipals
  • Corporate real estate
  • Consumer real estate

Solutions in this space often call for a combination of art and science, which effectively means a combination of statistical and expert judgment approaches.

Return to Top