This training program will detail the development and use of credit ratings for credit risk assessment; development of financial statement regression techniques as embodied in the Altman Z score for credit risk assessment; differences in quantitative tools for differing loan type; importance of data quality for quantitative tools, and more.
This pre-transaction study is known as credit underwriting. After the lender has made the loan, it is also critically important to stay abreast of the likelihood of borrower repayment. This post-transaction review is surveillance.
This webinar will focus on the quantitative, rather than fundamental, analysis of the loan transaction for both underwriting and surveillance.
Why Should You Attend:
In financial markets, the credit risk of a borrower is simply the risk that the borrower - whether an individual, corporation, or government entity - will not pay the full interest and principal of the loan when contractually obligated to do so. Credit risk, therefore, is as old as lending itself. Lenders, therefore, must study a potential loan carefully to decide whether, and on what terms, to lend to a prospective borrower.This pre-transaction study is known as credit underwriting. After the lender has made the loan, it is also critically important to stay abreast of the likelihood of borrower repayment. This post-transaction review is surveillance.
This webinar will focus on the quantitative, rather than fundamental, analysis of the loan transaction for both underwriting and surveillance.
Learning Objectives:
- Learn the meaning, development, and use of credit ratings for credit risk assessment
- Learn the meaning and development of financial statement regression techniques as embodied in the Altman Z score for credit risk assessment
- Learn the necessary differences in quantitative tools for differing loan type (consumer, corporate, government, structured)
- Learn the critical importance of data quality for quantitative tools
- Learn the proper judgment and skepticism for the review of quantitative credit assessment
- Learn the limitations of credit ratings, regression analyses, Monte Carlo simulation, and other methods
Areas Covered in the Webinar:
- History and types of lending
- Consumer loans (credit card, auto loans, student loans, mortgages)
- Corporate loans (bonds, high-yield loans, senior debt, subordinated debt)
- Government entity loans (sovereign, sub-sovereign, general obligation, revenue bonds)
- Structured finance debt (mortgage-backed securities, asset-backed securities, collateralized debt obligations)
- Credit ratings
- Moody’s, Standard & Poor’s, Fitch, and other credit rating agencies
- Regression analysis (ordinary least squares, logistic, probit)
- Financial statements (balance sheet, income statement, cash flow statement)
- Cash flow model
- Portfolio default model
- Monte Carlo technique
- Default probability
- Asset correlation
Who Will Benefit:
- All analysts, traders, and managers in front, middle, and back office of all banks and financial institutions
- Auditors to financial firms
- Financial consultants
- Investment professionals
- Treasury department professionals of all firms with activity involving issuance of debt
- Financial group professionals of all firms with activity involving financial assets of the firm such as accounts receivable, trade receivables, hedges and derivatives
- Professionals employed with government and supra-national entities with activity related to financial aspects of their organizations
Course Provider
Joseph M. Pimbley,
