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We are always interested in speaking to members of the media on news and events affecting the world of corporate credit risk. We look forward to hearing from you.
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For Immediate Release
Moody's KMV™ Offers Its Powerful Public and Private Firm Default Probability Models in One Credit Risk Management Platform
SAN FRANCISCO, July 22, 2003 - Moody's KMV, the world's leading provider of quantitative credit risk products for lenders and investors, has integrated its industry leading RiskCalc™ product line of localized private firm default probability models with its popular Credit Monitor™ product in use at most of the world's largest financial institutions. The integration allows credit risk professionals the convenience of analyzing portfolios across a broad range of borrowers, asset sizes and geographies in one platform.
Additionally, this integration connects the Credit Monitor analysis tools with Moody's KMV's popular financial statement spreading software (Moody's KMV Financial Analyst™), further improving the accuracy and efficiency of the credit portfolio decision-making process. The ability for portfolio managers to combine information from Moody's KMV's models allows more effective credit risk management, reducing monitoring costs and credit losses. For the first time, managers of middle market credit risk can have access to the power of RiskCalc in the same analytic environment that large institutions have been using to manage public market credit risk for years.
"The Credit Monitor platform provides significantly more functionality to the existing RiskCalc environment, providing users with new ability to track, visualize and analyze the credit risk trends of individual obligors, industries, and portfolios" said Dr. Roger M. Stein, Managing Director at Moody's KMV. "It allows RiskCalc users to compare private companies' default probabilities to industry medians based either on public firms or private firms or any combination of companies."
Additionally, the integration with CM and public company EDF™ Credit Measures fills a major "blind spot" problem that is typical in private company lending, according to Dr. Stein.
Financial information on private companies is usually updated yearly, or quarterly at best, with interim statements not usually audited. Having the private borrower information in Credit Monitor allows the comparison of the borrower's default probability with monthly industry indices in Credit Monitor. Since the indices are updated based on current credit risk information derived from public market information, private firm risk managers can monitor and act on sector credit deterioration long before private firm financials are received. "Understanding and acting on sectoral effects can translate into reduced losses."said Dr. Stein.
The enhanced Credit Monitor tool provides an integrated solution for portfolios comprised of exposures to public firm counter-parties globally and private firm counter-parties in the USA, Canada, UK, and Australia. Additional models will be added in the future.
About Moody’s KMV
Moody’s KMV, a wholly owned subsidiary of Moody's Corporation, is the world’s leading provider of quantitative credit risk analysis tools to lenders, investors, and corporations. Moody’s KMV's tools provide current default probabilities, recovery estimates, valuations and correlations, and are widely used to assess portfolio risk/return. Serving over 2,000 clients in 80 countries, including most of the world's 100 largest financial institutions, Moody’s KMV maintains the largest and cleanest database of corporate defaults in the world. In addition to its San Francisco headquarters, Moody’s KMV has offices around the world to serve its global customer base.
About Moody's Corporation
Moody's Corporation (NYSE: MCO) is the parent company of Moody's Investors Service, a leading provider of credit ratings, research and analysis covering debt instruments and securities in the global capital markets, and Moody's KMV, the leading provider of market-based quantitative services for banks and investors in credit-sensitive assets serving the world's largest financial institutions. The corporation, which reported revenue of $1.2 billion in 2003, employs approximately 2,300 people worldwide and maintains offices in 18 countries. Further information is available at www.moodys.com.
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