Credit analysis


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Credit analysis

Evaluating information on companies and bond issues in order to estimate the ability of the issuer to live up to its future contractual obligations. Related: Default risk.

Credit Analysis

The process of determining the likelihood of default, especially by a bond issuer. Credit rating agencies conduct credit analysis in order to provide bond ratings; they may change these from time to time. Bond investors likewise conduct credit analysis. For example, if an investor's credit analysis indicates that a bond rating is about to decrease, he/she will be unlikely to invest in that bond, as it will lead to locking in a lower interest rate at a higher level of risk. On the other hand, if credit analysis shows that a bond rating is about to increase, an investor will be more inclined to buy that bond, as it provides a lower level of risk while also giving him/her a higher coupon. See also: Investment-grade, Junk.
References in periodicals archive ?
National Cooperative Bank (NCB) announced that Sandra Braun has joined the bank as vice president, heading the Commercial Loan Underwriting and Credit Analysis Team.
The XBRL activity that will have widespread impact on CPAS in the near term is Bank of America's pilot-testing of XBRL reporting by their commercial loan customers who provide financial statements for lending and credit analysis purposes.
These are, first, the adequacy of banks' credit analysis processes; second, the effectiveness of exposure measurement; and third, the role of stress testing of counterparty exposure.
There is a question whether adequate credit analysis was performed by creditors of Long-Term Capital, which needs to be examined carefully during the next few weeks.
Privately owned and independent, DBRS offers in-depth credit analysis of corporate and government issues in North America, Europe, Asia and Latin America.
Privately owned and independent, DBRS offers in-depth credit analysis of corporate, financial institutions and government issues in North America, Europe, Asia and Latin America.
The integration of International Financial Template with different RiskCalc models throughout Europe and Asia Pacific allows RiskAnalyst users - corporations and financial institutions - across different global markets to maximize their credit analysis through one comprehensive best in breed credit decisioning system.
Though placing emphasis on banks, this book is the first to look at how credit analysis of each major type of financial institution is best approached in an environment of integration, consolidation and globalisation within the financial services industry.
His over 30 years of credit analysis and lending to middle market companies of both asset-based facilities as well as traditional credit facilities will add great value to the team.
Since its inception in 1983, Flaherty & Crumrine has focused solely on applying fundamental credit analysis and research to managing preferred and hybrid preferred securities for its closed-end funds and institutional accounts.

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