Category Archives: Financial Risk Analysis

What Is Going Concern Rating?

My article, entitled “Going Concern Rating and Economic Analysis of Insolvency Risk” and published in GARP’s 2012 October Newsletter, explains the concept of going concern rating and its notching relationship with credit rating.  Please click on the link to get … Continue reading

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My Comment Letter on SEC’s Roundtable on Credit Ratings In my comment letter to the SEC, I advocated the urgent need for competitions on new financial information instead of higher ratings or lower fees, which is the only competition that the current credit … Continue reading

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My Comment Letter on FASB’s Proposal on Management Disclosure of Going Concern Uncertainty In my comments to FASB, I recommended that going concern rating be incorporated in financial reporting so as to meet the information requirement for maintaining going concern … Continue reading

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Rating Contingent Capital Securities

Introduction FSOC released its report on contingent capital on July 18, entitled “Report to Congress on Study of a Contingent Capital Requirement for Certain Nonbank Financial Companies and Bank Holding Companies”.  The report places a particular focus on the important … Continue reading

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Going… less going… much less going… gone.

It appears that there is one common issue in bank resolution, recapitalization and structuring going concern capital instruments, the lack of a standardized, consistent, audited, comparable, transparent and well defined trigger.  Market based triggers are subject to manipulation, regulatory triggers … Continue reading

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Would going concern rating become an alternative creditworthiness standard?

Given the current divergence on going concern guidance in both accounting and auditing regulations and reliance of ICAAP, or economic capital adaequacy assessment in Pillar 2, on the assumption of going concern, it appears that going concern rating could potentially … Continue reading

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