Kazinvestbank chooses S&P Global Market Intelligence’s Credit Assessment Scorecard for the Assessment of SME’s
July 5, 2016
S&P Global Market Intelligence, a division of S&P Global (NYSE: SPGI) offering global multi-asset class data, market research and portfolio analytics to global investors, today announced it has been chosen by Kazakhstan based commercial bank, JSC Kazinvestbank, to implement an internal credit risk assessment system for Small & Medium Enterprises (“SME’s”) in the bank’s corporate portfolio.
Kazinvestbank will implement the SME Credit Assessment Scorecard developed by S&P Global Market Intelligence, a framework where the credit risk scoring process provides a high degree of consistency and replicability. The Scorecard facilitates the identification of default risk through a granular 20-point scale. The resulting scores can be mapped to 34 years of historically observed default frequencies or the bank’s own internal scale. This major step forward in the refinement of Kazinvestbank’s internal ratings system is intended both for IFRS 9 and wider purposes.
“The decision to work with a leading provider of credit risk assessment is in line with the bank’s approach to adopt best practices and leverage international experience to help the bank achieve its objectives,” said Mr Askar Omarov, First Deputy CEO of Kazinvestbank. “Adopting credit risk assessment methodology in line with a recognized international standard will help us continue with this positive trend of the bank’s development”.
“We are delighted to be selected by Kazinvestbank to implement an internal rating system for the assessment of SME’s. The SME Scorecard not only assesses credit quality in a transparent and robust manner, but also exhibits strong discriminatory power,” commented Carlos Gugliemo, Head of Analytics, EMEA at S&P Global Market Intelligence. “SME’s play a fundamental role in the economy of many countries and a rigorous credit risk assessment process factoring in SME’s specificities is a critical component of risk management for SME lenders.”
“Reliable credit risk assessment models are the cornerstone of every credit sensitive institution, whether you wish to improve your risk-adjusted return, manage your capital requirements or are trying to achieve broader objectives, such as those of Kazinvestbank,” said Natalia Jones, Director at S&P Global Market Intelligence. “Keeping an internal rating system updated and maintained on a regular basis will help a bank ensure that it has appropriate tools to achieve those objectives.”