RiskMetrics and S&P integrate credit products

The firms are building an interface between S&P’s CreditModel, an internet-accessible credit-scoring model for public and private firms, and RiskMetrics’ CreditManager, a credit portfolio risk measurement, analysis and reporting tool. The interface will allow customers to access CreditModel analytics and generate obligor credit scores directly from within CreditManager.

"CreditModel is currently used by a wide variety of clients to assess individual credit risk exposure. With this new interface, CreditModel will become an important tool for clients managing credit risk on a portfolio basis,” said Roy Taub, executive managing director of Standard & Poor's Risk Solutions.

CreditModel is a series of industry- and region-specific credit-scoring models that allow users to generate evaluations of an organisation's creditworthiness, although it falls short of providing actual credit ratings.

"The integration is a logical next step in our drive to make credit portfolio risk analysis systematic, intuitive and actionable," said Peter Bernard, executive director of RiskMetrics.

CreditManager has been able to accept credit feeds from RiskCalc, developed by S&P rival Moody's, since August last year. But the S&P link will be tighter as the new version of Credit Manager, due for launch in the next couple of weeks, will be browser-based, allowing near seamless updating of credit information through Net-based pop-up applications. The browser-based service will also allow multi-user functionality and new analytics related to capital usage and capital allocation, Bernard told RiskNews.

CreditManager clients, currently numbering around 100 worldwide, can already enter publicly available debt data, or hook-up their proprietary credit databases.

S&P teamed up with Toronto-based risk management solutions provider Algorithmics last week to create closer interaction and joint marketing of the two firms’ credit risk products and jointly market combined credit solutions.

Credit ratings, transition matrices, default probabilities and loan pricing information from S&P's CreditModel, CreditPro, Rating Express, PDM Loss/Recovery and Leveraged Comps Databases will be streamed into Algo's year-old Portfolio Credit Risk Engine and its Credit eValuator under the terms of that deal.