Understand the Impact of Changing Market Conditions on Loan Portfolios and Internal Rating Models
We live in a dynamic global economy where macroeconomic factors change in the blink of an eye. Regulators and shareholders expect financial institutions to understand - more than ever - the effect these changing macroeconomic factors have on loan portfolios and individual loans. They also expect banks to ensure that there are sufficient capital buffers in place to withstand sudden changes in the economy. With higher capital requirements on the horizon, banks are also under pressure to deploy capital more effectively, while still delivering targeted returns. Without the right systems in place, these challenges are significant.
Insights from Scenario Analyzer can be used to manage risk more effectively and ensure your firm has adequate reserves to withstand an extreme event. Scenario Analyzer can also help credit modelers develop better models by running existing internal rating models quickly and efficiently through different sets of assumptions.