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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
New Browser-Based Ratings Package by Moody’s KMV Produces Specialized Credit Grades for Financial Institutions and Corporations
Moody’s KMV RiskAnalyst is a Configurable Framework for Internal Rating Models Incorporating Financial and Non-Financial Risk Factors
SAN FRANCISCO, January 24, 2005 - Moody’s KMV today announced the first browser-based release of its popular data collection and credit analysis tool to accommodate, centralize and deploy internal ratings models by offering a Ratings package which can incorporate its Expected Default Frequency™ (EDF) measure and other financial and non-financial data.
The ratings capability, which is incorporated into the new Version 3.0 of Moody’s KMV’s RiskAnalyst tool, works alongside the product’s traditional financial statement inputs and allows additional, non-financial data to be entered into the tool’s platform to produce both borrower and facility grades in a centralized and controlled manner. The information, including internal borrower grades, Probabilities of Default and Loss Given Default and Expected Loss estimates, can then be used to calculate regulatory capital to price, and help to manage risk at the portfolio level. These new features can also help banks comply with the Basel II Accord, which requires them to develop and employ internal ratings based systems.
Many financial institutions and corporations already maintain dozens of internally developed rating models to deal with specific rating needs. Now RiskAnalyst can be used to automate and deploy internal rating models currently implemented on paper, spreadsheets or other home-grown methods to provide users a configurable and highly organized framework, bringing together the specialized factors critical to such models.
“In October 2003 we introduced RiskAnalyst and, through the use of new technology, brought new efficiency to the deployment of our successful approach to standardizing the way financial statement data is captured, presented and delivered within the credit review process,” said Mary Jan Hedman, a senior director at Moody’s KMV. “Now we have added the Ratings Package to bring the same centralization, organization, consistency and deployment to internal ratings based on financial and non-financial data.”
Moody’s KMV believes the Ratings Package will be of interest to large financial institutions that have already developed various internal ratings systems, smaller banks, banks in less developed economies that are recognizing the need for such models, and corporations that need to evaluate the creditworthiness of their loan and credit obligors.
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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