Scenario Analysis with the DD-PD Mapping Approach : Stock Market Shocks and U.S. Corporate Default Risk /

This paper introduces the quantile regression- based Distance-to-Default to Probability of Default (DD-PD) mapping, which links individual firms' DD to their real world PD. Since changes in the DD depend on a handful of parameters, the mapping easily accommodates shocks arising from quantitativ...

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Մատենագիտական մանրամասներ
Հիմնական հեղինակ: Chan-Lau, Jorge
Ձևաչափ: Ամսագիր
Լեզու:English
Հրապարակվել է: Washington, D.C. : International Monetary Fund, 2021.
Շարք:IMF Working Papers; Working Paper ; No. 2021/143
Խորագրեր:
Առցանց հասանելիություն:Full text available on IMF
Նկարագրություն
Ամփոփում:This paper introduces the quantile regression- based Distance-to-Default to Probability of Default (DD-PD) mapping, which links individual firms' DD to their real world PD. Since changes in the DD depend on a handful of parameters, the mapping easily accommodates shocks arising from quantitative and narrative scenarios informed by expert judgment. At end-2020, risks from stock market corrections in the U.S. are concentrated in the energy, financial and technology sectors, and additional bank capital needs could be large. The paper concludes discussing uses of the mapping beyond PD valuation suitable for capital structure analysis, credit portfolio management, and long-term scenario planning analysis.
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Ֆիզիկական նկարագրություն:1 online resource (24 pages)
Ձևաչափ:Mode of access: Internet
ISSN:1018-5941
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