Question: Why is credit risk analysis an important component of FI
Why is credit risk analysis an important component of FI risk management?
Answer to relevant QuestionsIn what ways does the credit analysis of a mid-market borrower differ from that of a small-business borrower?How does an FI evaluate its credit risks with respect to consumer and small business loans?Consider the coefficients of Altman’s Z-score. Can you tell by the size of the coefficients which ratio appears most important in assessing the creditworthiness of a loan applicant? Explain.Use the balance sheet and income statement below to construct a statement of cash flows for 2016 for Clancy’s Dog BiscuitCorp.What are core deposits? What role do core deposits play in predicting the probability distribution of net deposit drains?
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