Featured Product

    Unlocking Trade Credit Limits for Enhanced Returns

    The traditional loss-minimizing approach to managing corporate trade credit can keep write-offs low but may be overly conservative.

    When a trade credit group focuses instead on return, several value-adding limit and margin adjustments can typically be identified. This enables additional sales in some cases and margin-based deal pricing in others.  
    The key enabler in this approach is high-quality, comprehensive, and consistent probability of default data. Join us for this webinar as our credit experts demonstrate the overall economic value approach to setting credit limits and highlight the characteristics of an accounts receivable (AR) portfolio that shows significant profit growth potential. 

    This session will highlight:  
    • A comparison of traditional and economic credit limit tables  
    • Examples of margin-based deal pricing  
    • Three real-life case studies with different ratings  
    • Scenarios that explore real-time disruptions such as oil price shocks or COVID-19 impacts  

    Presentation Slides
    Related Articles

    Adjusting Capital Planning and Strategies for a COVID-19 Scenario

    Nobody expected the end of the economic cycle to happen so suddenly, but adjustments will be required given the materiality of the events unfolding. How can you quickly adjust for an ever-evolving scenario where today’s assumptions may not hold tomorrow.

    May 2020 WebPage Laurent Birade, Olivier Brucker, Ed Young

    Unfunded Commitments: Unintended Consequences in Times of Turmoil

    The COVID-19 pandemic has pushed many commercial entities to increase their borrowing and drawdown on their lines of credit. We use bank call report data to analyze the potential impact to capital levels at US financial institutions.

    April 2020 Pdf Laurent Birade, James Partridge, Alex Cannon

    Incorporation of CECL Into Stress Testing and Capital Planning

    Join our experts as they review the business challenges that CECL presents beyond the reporting date numbers.

    April 2020 WebPage Laurent Birade, Olivier Brucker, Ed Young

    Dual risk rating and origination strategies: optional (until they are not)?

    During the last financial crisis, some of the better-performing commercial credits were originated under extremely conservative origination policies This paper explores risk rating options and advises what you can do now to enhance your origination process.

    April 2020 WebPage Laurent Birade, James Partridge

    The Economics of Wholesale Credit

    Traditionally, corporate trade credit limits have been set based on customer size, an internal or external credit score, and a qualitative sense of risk appetite. These limits have been effective in minimizing write-offs, principally because they are conservative.

    March 2020 WebPage Michael Denton, Laurent Birade, Gustavo Jimenez

    Company AA Displayed Increasing Default Risk Starting Late-2015

    Company AA, a U.S.-based transportation company, defaulted in August, 2018. The Moody’s Analytics EDF™ (Expected Default Frequency) metric and Early Warning Toolkit highlighted the company’s rising default risk 33 months before default. This case study details how the EDF measure and Early Warning Toolkit can assess risk.

    February 2020 WebPage Irina Baron, Gustavo Jimenez

    Cards and CECL estimates

    Recent CECL impact disclosures point directly to credit cards as the largest driver of the allowance. We can confirm those recent disclosures by looking at the consumer default volumes chart in Figure 1,which clearly point to the credit card segment as being one of the largest contributors of loss today.

    January 2020 WebPage Laurent BiradeDavid Fieldhouse

    The Risk Management Impact of Climate Change & Environmental, Social, & Governance Risk (ESG)

    Climate change and its increasing economic toll on businesses in different sectors of the economy is discussed, including how to operationalize the response to climate change risk, given stakeholder need. Also discussed is the linkage between environmental risk and other ESG risk factors to security returns and measures of credit risk.

    November 2019 Pdf Michael Denton, Cristian deRitis

    Moody's Analytics Webinar: New Accounting Standards - Impact and Implementation for Insurers

    Join our Moody's Analytics experts as they focus on the implementation challenges of the new accounting standards – CECL, IFRS 9, IFRS 17 and LDTI.

    September 12, 2019 WebPage Laurent Birade, Srinivasan Iyer

    New Accounting Standards - Impact and Implementation for Insurers

    September 2019 WebPage Srinivasan Iyer, Laurent Birade
    RESULTS 1 - 10 OF 20