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Portfolio Valuation
After the recent and ongoing credit crisis, all types of consumer loans are under the microscope.
In such an environment, the calculation of leverage on a risk adjusted basis to estimate the increased cost of equity on loans that carry a higher risk has gained new prominence in the loan portfolio valuation process.
What are the BASEL II norms for calculating leverage on consumer loans? How sensitive are valuations to the estimation of leverage ?
Given the recent volatility in the Equity and Interest rate markets, should loan portfolios be valued using WACC or Cost of Equity ?
Also, how sensitive are consumer loan portfolio valuations to pre-payment assumptions among others?
On a more macro level, given the current economic environment with universal expectations of a prolonged slow-down,
an uptick in delinquencies, stagnant or marginally declining networth of households and rising unemployment, would a bottom-up valuation approach be more meaningful than a top-down approach?
We can provide the answers:
Our Portfolio Valuation services aim at providing account level scenario analysis capabilities and achieving a high level of precision in valuing credit portfolios using our proprietary MicroValueTM framework.
For more information contact us at info@theskillmill.com. Please take a moment to answer a brief survey question and view responses by retail bankers from across the world:
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