Global leaders in counterparty and credit risk assessment

Assessing a potential partner? Setting up a new line of credit or extending credit for a single transaction?The coordination of multiple parties is an integral element of successful commodity and freight operations. In the absence of proper financial security, parties depend on cooperation, trust, and often open credit terms in order to carry out trade. This requirement makes the proper management of counterparty and credit risk vital for ensuring all parties are protected and trade risks minimised.

Counterparty and Credit Risk Assessment

Credit Risk

 

Without the security of counterparty and credit risk assessments, you might enter into trade agreements with financially unstable parties. Should transactions fail, you could find yourself bound by terms of agreement to such parties. Counterparty risks include companies that fail to comply with bonds, insurance policies, or other contracts.

Due to the nature of credit risks, it is often difficult foryou to reclaim collateral from your counterparties, leaving you exposed to financial losses. In addition to operational damages, there are a number of other risks associated with unreliable counterparties.

 

Credit, legal, and reputational risks

 

Credit risk is the damage to your own credit rating as a result of uncooperative, inefficient, or inadequate counterparties. This kind of damage is lasting and can complicate future transactions when potential counterparties carry out their own counterparty and credit risk assessments on your company.

A legal risk can exist if your transaction fails, if you are liable to another party for losses incurred as a result of being able to fulfil transactions, or if you fail to properly protect assets owned by a counterparty. Liability and subsequent litigation can incur expensive costs, especially for global companies.

Reputational risk covers losses associated with damage to your company’s reputation. Corporate trust is crucial to securing trade partnerships; with increasing digitisation of performance records and communication, damage of this kind is accessible and lasting. Reputational risks include lost revenue, capital, regulatory costs, and damage to your shareholder value as a direct result of improper counterparty conduct.

 
Counterparty and credit risk assessment

 

Counterparty and credit risk assessments offer the expert analysis and business intelligence you need to properly assess potential partners. Review your counterparty’s credit history and market performance. Understand their management structure and accountability. Investigate their financial references and payment processes. Know who you are entering into trade discussions with before committing to potentially damaging contracts.

Whether you’re entering into trade discussions with a new party or are setting up a new transaction, our comprehensive reports detail the precise information and analysis you need to make fast, confident trade decisions with minimal regulatory, operational, legal, and reputational risk.


See how our counterparty and credit risk assessments have previously benefited our clients in this case study. For key insights into your industry and competitors, choose from our three service packages here.

Ownership and management structure

Operational activity and market performance

Financial position (even in the absence of accounts)

References and payment performance

Registered details

Infospectrum rating