Financial Institutions

ARC Ratings Financial Institutions methodology includes:

  • A network analysis-based assessment of the interconnectedness of each rated financial institution in order to understand its systemic importance
  • An analysis of the complexity of the respective financial institution reflected not only by its on and off-balance sheet positions, but also in reviewing the results of so-called living wills, where they exist
  • Concentration risk, not only of the institution to be rated, but also of the system within which it is headquartered
  • ARC Ratings centres its analysis on liquidity risk as liquidity risk equates to credit risk for financial institutions
  • In addition to liquidity and systemic risk, ARC Ratings rating methodology also considers market and operational risk, as far as those risks may impact the creditworthiness of the rated institution


 

   

 

 

 
 

 

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