AbsolutePD produces statistical estimates of Probabilities of Default (PD) for each business borrower in a lender’s portfolio – up to eight quarters ahead. This is done by combining current macroeconomic information with payment histories from our comprehensive proprietary database of term debt contracts.
BENEFITS TO USERS
- Streamlines annual review and renewal processes.
- Controls cost and timeliness of loan review process by conducting targeted loan reviews/renewals where warranted.
- Enhance Early Warning systems to identify deteriorating credits and take pro-active measures.
- Build a more objective, forward looking and granular risk rating system.
- Identify risk migration and trends (both unfavorable and favorable) of all borrowers based on changes in PD every quarter.
- Approach loss forecasting and capital allocation with greater objectivity and granularity, increasing the precision of ALL estimates.
About AbsolutePD Dataset
AbsolutePD delivers an absolute measure of credit risk at both the borrower and portfolio level. Each forecast is powered by the quarterly calibration of:
- Latest local and national economic conditions.
- Loan performance and condition of each of your borrowers.
- Loan performance and condition experienced by other lenders with your borrower.
Every quarter we deliver a complete dataset (e.g. Excel) of the entire portfolio that includes each borrower’s eight-quarter PD forecast, loan performance and condition summary. Online access is also available using AbsolutePD® Portfolio Manager.
AbsolutePD provides a consistent, transparent and objective loan management process mandated by management, auditors, regulators and investors.
Read an AbsolutePD case study.
To purchase AbsolutePD or to learn more about how it can benefit your portfolio management and capital allocation, contact us today.