{"product_id":"the-handbook-of-credit-risk-management-isbn-9781119835639","title":"The Handbook of Credit Risk Management","description":"\u003cp\u003e\u003cb\u003eDiscover an accessible and comprehensive overview of credit risk management\u003c\/b\u003e \u003c\/p\u003e\u003cp\u003eIn the newly revised \u003ci\u003eSecond Edition\u003c\/i\u003e of \u003ci\u003eThe Handbook of Credit Risk Management: Originating, Assessing, and Managing Credit Exposures\u003c\/i\u003e, veteran financial risk experts Sylvain Bouteillé and Dr. Diane Coogan-Pushner deliver a holistic roadmap to credit risk management (CRM) ideal for students and the busy professional. \u003c\/p\u003e\u003cp\u003eThe authors have created an accessible and practical CRM resource consistent with a commonly implemented risk management framework. Divided into four sections—Origination, Credit Assessment, Portfolio Management, and Mitigation and Transfer—the book explains why CRM is critical to the success of large institutions and why organizational structure matters. \u003c\/p\u003e\u003cp\u003eThe \u003ci\u003eSecond Edition\u003c\/i\u003e of \u003ci\u003eThe Handbook of Credit Risk Management\u003c\/i\u003e also includes: \u003c\/p\u003e\u003cul\u003e \u003cli\u003eNewly updated and enriched data, charts, and content\u003c\/li\u003e \u003cli\u003eThree brand new chapters on consumer finance, state and local credit risk, and sovereign risk\u003c\/li\u003e \u003cli\u003eNew ancillary material designed to support higher education and bank credit training educators, including case studies, quizzes, and slides\u003c\/li\u003e\n\u003c\/ul\u003e\u003cp\u003ePerfect for risk managers, corporate treasurers, auditors, and credit risk underwriters, this latest edition of \u003ci\u003eThe Handbook of Credit Risk Management\u003c\/i\u003e will also prove to be an invaluable addition to the libraries of financial analysts, regulators, portfolio managers, and actuaries seeking a comprehensive and up-to-date guide on credit risk management. \u003c\/p\u003e\u003cp\u003ePreface xiii\u003c\/p\u003e \u003cp\u003eAcknowledgments xxi\u003c\/p\u003e \u003cp\u003eAbout the Companion Website xxiii\u003c\/p\u003e \u003cp\u003e\u003cb\u003ePart One Origination\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 1 Fundamentals of Credit Risk 3\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eWhat Is Credit Risk? 3\u003c\/p\u003e \u003cp\u003eTypes of Transactions That Create Credit Risk 5\u003c\/p\u003e \u003cp\u003eWho Is Exposed to Credit Risk? 9\u003c\/p\u003e \u003cp\u003eWhy Manage Credit Risk? 19\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 2 Governance 21\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eGuidelines 22\u003c\/p\u003e \u003cp\u003eSkills 25\u003c\/p\u003e \u003cp\u003eSetting Limits 30\u003c\/p\u003e \u003cp\u003eOversight 30\u003c\/p\u003e \u003cp\u003eFinal Words 33\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 3 Checklist for Origination 35\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eDoes the Transaction Fit into My Strategy? 36\u003c\/p\u003e \u003cp\u003eDoes the Risk Fit into My Existing Portfolio? 37\u003c\/p\u003e \u003cp\u003eDo I Understand the Credit Risk? 38\u003c\/p\u003e \u003cp\u003eDoes the Seller Keep an Interest in the Deal? 39\u003c\/p\u003e \u003cp\u003eAre the Proper Mitigants in Place? 40\u003c\/p\u003e \u003cp\u003eIs the Legal Documentation Satisfactory? 41\u003c\/p\u003e \u003cp\u003eIs the Deal Priced Adequately? 41\u003c\/p\u003e \u003cp\u003eDo I Have the Skills to Monitor the Exposure? 42\u003c\/p\u003e \u003cp\u003eIs There an Exit Strategy? 43\u003c\/p\u003e \u003cp\u003eFinal Words 44\u003c\/p\u003e \u003cp\u003e\u003cb\u003ePart Two Credit Assessment\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 4 Measurement of Credit Risk 47\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eExposure 47\u003c\/p\u003e \u003cp\u003eProbability of Default 52\u003c\/p\u003e \u003cp\u003eThe Recovery Rate 62\u003c\/p\u003e \u003cp\u003eThe Tenor 63\u003c\/p\u003e \u003cp\u003eDirect versus Contingent Exposure 64\u003c\/p\u003e \u003cp\u003eThe Expected Loss 65\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 5 Dynamic Credit Exposure 67\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eLong-Term Supply Agreements 68\u003c\/p\u003e \u003cp\u003eDerivative Products 70\u003c\/p\u003e \u003cp\u003eThe Economic Value of a Contract 73\u003c\/p\u003e \u003cp\u003eMark-to-Market Valuation 75\u003c\/p\u003e \u003cp\u003eValue at Risk (VaR) 78\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 6 Fundamental Credit Analysis 81\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eAccounting Basics 83\u003c\/p\u003e \u003cp\u003eA Typical Credit Report 91\u003c\/p\u003e \u003cp\u003eAgency Conflict, Incentives, and Merton’s View of Default Risk 100\u003c\/p\u003e \u003cp\u003eFinal Words 105\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 7 Alternative Estimations of Credit Quality 107\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eThe Evolution of an Indicator: Moody’s Analytics EDF™ 108\u003c\/p\u003e \u003cp\u003eCredit Default Swap Prices 114\u003c\/p\u003e \u003cp\u003eBond Prices 120\u003c\/p\u003e \u003cp\u003eFinal Words 121\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 8 Consumer Finance 123\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eWhat Is Consumer Finance? 126\u003c\/p\u003e \u003cp\u003eSegmentation of Consumer Finance Products 127\u003c\/p\u003e \u003cp\u003eMajor Families of Consumer Finance Products 129\u003c\/p\u003e \u003cp\u003eAssessment of Credit Quality 136\u003c\/p\u003e \u003cp\u003eDecisions by Lenders 139\u003c\/p\u003e \u003cp\u003eRegulatory Environment 143\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 9 State and Local Government Credit 145\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eState and Local Governments 145\u003c\/p\u003e \u003cp\u003eExposure Types 146\u003c\/p\u003e \u003cp\u003eAssessing Credit Risk 152\u003c\/p\u003e \u003cp\u003eManaging Credit Risk 156\u003c\/p\u003e \u003cp\u003eFinal Words 160\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 10 Sovereign Credit Risk 161\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eSovereign Borrowers 161\u003c\/p\u003e \u003cp\u003eTypes of Sovereign Bonds 162\u003c\/p\u003e \u003cp\u003eSovereign Debt Market 163\u003c\/p\u003e \u003cp\u003eCredit Analysis 163\u003c\/p\u003e \u003cp\u003eMitigation 166\u003c\/p\u003e \u003cp\u003eDefault and Recovery 167\u003c\/p\u003e \u003cp\u003eFinal Words 168\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 11 Securitization 169\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eAsset Securitization Overview 171\u003c\/p\u003e \u003cp\u003eThe Collateral 174\u003c\/p\u003e \u003cp\u003eThe Issuer 178\u003c\/p\u003e \u003cp\u003eThe Securities 179\u003c\/p\u003e \u003cp\u003eMain Families of ABSs 182\u003c\/p\u003e \u003cp\u003eSecuritization for Risk Transfer 186\u003c\/p\u003e \u003cp\u003eCredit Risk Assessment of ABS 189\u003c\/p\u003e \u003cp\u003eWarehousing Risk 191\u003c\/p\u003e \u003cp\u003eFinal Words 192\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 12 Collateral Loan Obligations (CLOs) 193\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eOverview of the Corporate Loan Market 194\u003c\/p\u003e \u003cp\u003eWhat Are CLOs? 194\u003c\/p\u003e \u003cp\u003eArbitrage CLOs 196\u003c\/p\u003e \u003cp\u003eBalance Sheet CLOs 200\u003c\/p\u003e \u003cp\u003eABS CDOs 205\u003c\/p\u003e \u003cp\u003eCredit Analysis of CLOs 207\u003c\/p\u003e \u003cp\u003e\u003cb\u003ePart Three Portfolio Management\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 13 Credit Portfolio Management 213\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eLevel 1 215\u003c\/p\u003e \u003cp\u003eLevel 2 219\u003c\/p\u003e \u003cp\u003eLevel 3 224\u003c\/p\u003e \u003cp\u003eOrganizational Setup and Staffing 226\u003c\/p\u003e \u003cp\u003eThe IACPM 227\u003c\/p\u003e \u003cp\u003eFinal Words 227\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 14 Economic Capital and Credit Value at Risk (CVaR) 229\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eCapital: Economic, Regulatory, Shareholder 230\u003c\/p\u003e \u003cp\u003eDefining Losses: Default versus Mark-to-Market (MTM) 232\u003c\/p\u003e \u003cp\u003eCredit Value at Risk or CVaR 235\u003c\/p\u003e \u003cp\u003eCreating the Loss Distribution 242\u003c\/p\u003e \u003cp\u003eActive Portfolio Management and CVaR 249\u003c\/p\u003e \u003cp\u003ePricing 251\u003c\/p\u003e \u003cp\u003eFinal Words 252\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 15 Regulation 255\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eDoing Business with a Regulated Entity 256\u003c\/p\u003e \u003cp\u003eDoing Business as a Regulated Entity 262\u003c\/p\u003e \u003cp\u003eHow Regulation Matters: Key Regulation Directives 263\u003c\/p\u003e \u003cp\u003eFinal Words 271\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 16 Accounting Implications of Credit Risk 273\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eLoan Impairment 274\u003c\/p\u003e \u003cp\u003eLoan-Loss Accounting 275\u003c\/p\u003e \u003cp\u003eRegulatory Requirements for Loan-Loss Reserves 277\u003c\/p\u003e \u003cp\u003eImpairment of Debt Securities 278\u003c\/p\u003e \u003cp\u003eDerecognition of Assets 279\u003c\/p\u003e \u003cp\u003eConsolidation of Variable Interest Entities (VIEs) 280\u003c\/p\u003e \u003cp\u003eAccounting for Netting 281\u003c\/p\u003e \u003cp\u003eHedge Accounting 282\u003c\/p\u003e \u003cp\u003eCredit Valuation Adjustments, Debit Valuation Adjustments, and Own Credit Risk Adjustment 284\u003c\/p\u003e \u003cp\u003eIFRS 7 285\u003c\/p\u003e \u003cp\u003eFinal Words 285\u003c\/p\u003e \u003cp\u003e\u003cb\u003ePart Four Mitigation and Transfer\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 17 Mitigating Derivative Counterparty Credit Risk 289\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eMeasurement of Counterparty Credit Risk 289\u003c\/p\u003e \u003cp\u003eMitigation of Counterparty Credit Risk through Collateralization 290\u003c\/p\u003e \u003cp\u003eLegal Documentation 298\u003c\/p\u003e \u003cp\u003eDealers versus End Users 299\u003c\/p\u003e \u003cp\u003eBilateral Transactions versus Central Counterparty Clearing 299\u003c\/p\u003e \u003cp\u003ePrime Brokers 303\u003c\/p\u003e \u003cp\u003eRepurchase Agreements 304\u003c\/p\u003e \u003cp\u003eFinal Words 306\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 18 Structural Mitigation 307\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eTransactions with Corporates 308\u003c\/p\u003e \u003cp\u003eTransactions with Special Purpose Vehicles 317\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 19 Credit Insurance, Surety Bonds, and Letters of Credit 325\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eCredit Insurance 326\u003c\/p\u003e \u003cp\u003eSurety Bonds 332\u003c\/p\u003e \u003cp\u003eLetters of Credit or LoCs 335\u003c\/p\u003e \u003cp\u003eThe Providers’ Point of View 339\u003c\/p\u003e \u003cp\u003eFinal Words 342\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 20 Credit Derivatives 345\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eThe Product 345\u003c\/p\u003e \u003cp\u003eThe Settlement Process 349\u003c\/p\u003e \u003cp\u003eValuation and Accounting Treatment 354\u003c\/p\u003e \u003cp\u003eUses of CDSs 356\u003c\/p\u003e \u003cp\u003eCredit Default Swaps for Credit and Price Discovery 360\u003c\/p\u003e \u003cp\u003eCredit Default Swaps and Insurance 360\u003c\/p\u003e \u003cp\u003eIndexes, Loan CDSs, MCDSs, and ABS CDSs 361\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 21 Bankruptcy 363\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eWhat Is Bankruptcy? 364\u003c\/p\u003e \u003cp\u003ePatterns of Bankrupt Companies 365\u003c\/p\u003e \u003cp\u003eSignaling Actions 368\u003c\/p\u003e \u003cp\u003eExamples of Bankruptcies 369\u003c\/p\u003e \u003cp\u003eFinal Words 372\u003c\/p\u003e \u003cp\u003eAbout the Authors 373\u003c\/p\u003e \u003cp\u003eIndex 375\u003c\/p\u003e \u003cp\u003e\u003cb\u003eSYLVAIN BOUTEILLÉ\u003c\/b\u003e is Head of Trade Credit for the Americas at AIG, the global insurance company. Prior to AIG, Sylvain worked more than 20 years at Swiss Re. He holds a MSc degree in Civil Engineering from ENTPE (France) and an MBA from INSEAD (France).\u003c\/p\u003e \u003cp\u003e\u003cb\u003eDIANE COOGAN-PUSHNER, PhD,\u003c\/b\u003e has decades of experience in the financial services industry, working most recently as the Chief Risk Officer of Navigator’s Group, Inc., a publicly traded insurer. She received her doctorate from Boston University and is a CFA\u003csup\u003e®\u003c\/sup\u003e charterholder.  \u003c\/p\u003e\u003cp\u003eThe uncertainty of our global economy has not diminished since the first edition of \u003ci\u003eThe Handbook of Credit Risk Management\u003c\/i\u003e was released. The COVID pandemic has unleashed a new round of economic shock to every country in the world and is another wake-up call for company executives and financial institutions to be forward-thinking in managing credit exposures.  \u003c\/p\u003e \u003cp\u003eIn the Second Edition of\u003ci\u003e The Handbook of Credit Risk Management: Originating, Assessing, and Managing Credit Exposures,\u003c\/i\u003e renowned risk and finance professionals Sylvain Bouteillé and Dr. Diane Coogan-Pushner deliver a comprehensive treatment of credit risk management for institutions of all sizes. Written for the busy professional seeking a hands-on and practical guide to the subject, the book delivers on providing intuitive rationale, real-world guidance and executable risk management techniques.  \u003c\/p\u003e\u003cp\u003eDivided into four sections—origination, credit assessment, portfolio management, and mitigation and transfer—the authors offer a holistic treatment of CRM that provides an accessible and understandable treatment of the quantitative techniques and best practices commonly employed in the risk management framework: identification, measurement, pricing\/capital allocation, mitigation, and transfer\/distribution. \u003c\/p\u003e\u003cp\u003eThe updated Second Edition includes three new chapters covering consumer finance, state and local credit risk, and sovereign risk. \u003c\/p\u003e\u003cp\u003e\u003ci\u003eThe Handbook of Credit Risk Management\u003c\/i\u003e is perfect for risk managers, auditors, credit risk underwriters, and corporate treasurers. It’s also an indispensable guide for students, financial analysts, portfolio managers, and actuaries seeking a comprehensive and up-to-date guide on CRM.  \u003c\/p\u003e\u003cp\u003ePRAISE FOR \u003cb\u003eTHE HANDBOOK OF CREDIT RISK MANAGEMENT\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e“Bouteillé and Coogan-Pushner successfully capture the basics of credit risk with this straightforward, easy-to-read script providing a comprehensive overview of credit instruments and modern risk practices. A recommended study for those focused upon learning the nuts and bolts of credit risk management.” \u003c\/p\u003e\u003cp\u003e\u003cb\u003e—Loretta M. Hennessey, Partner, S2+ Advisors, and first chair, International Association of Credit Portfolio Managers (IACPM)\u003c\/b\u003e \u003c\/p\u003e\u003cp\u003e“Credit is the lifeblood of commerce and economic growth. Yet the risk it generates has caused the collapse of businesses, financial institutions and even sovereign entities. Understanding and managing credit risk is therefore an essential skill and this Handbook provides a very approachable, solid and comprehensive basis to do so.” \u003c\/p\u003e\u003cp\u003e\u003cb\u003e—Dr. Davide Crippa, Chief Risk Officer, Maybank Singapore\u003c\/b\u003e \u003c\/p\u003e\u003cp\u003e“A primer on credit risk for the student, risk manager, and finance professional. Comprehensive and approachable, with practical applications for managing single name credit exposure to enterprise-wide credit risk. \u003c\/p\u003e\u003cp\u003e\u003cb\u003e—Ellen Dion, Global Treasurer, AmTrust Financial Services Inc\u003c\/b\u003e \u003c\/p\u003e\u003cp\u003e“I wish I had this resource available when I began my career decades ago in credit risk management!” \u003c\/p\u003e\u003cp\u003e\u003cb\u003e—Jeffrey Satenstein, Managing Director and Senior Financial Officer (retired), JPMorgan Chase Investment Bank\u003c\/b\u003e\u003c\/p\u003e","brand":"Wiley","offers":[{"title":"Default Title","offer_id":47990247325925,"sku":"NP9781119835639","price":75.0,"currency_code":"USD","in_stock":false}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/1842\/7735\/files\/9781119835639.jpg?v=1761787053","url":"https:\/\/k12savings.com\/es\/products\/the-handbook-of-credit-risk-management-isbn-9781119835639","provider":"K12savings","version":"1.0","type":"link"}