Summary on rating methods gives valuable information to SMEs

The Finanzstandort Deutschland (IFD) initiative has published a highly interesting brochure for small and medium-sized entities which is free of charge and provides a summary of rating methodes and their qualitative as well as quantitative parameters currently applied by banks. The purpose of this brochure is to make comparable the evaluation of borrowers and accompanied risks by different banks. Furthermore, the most important expressions in connection with this subject are clearly explained in the brochure.

According to the brochure´s writers it is to provide a comprehensive and understandable source of information to German borrowers. It explains the close connection between the necessary rating of a borrower according to Basel II and the credit conditions for borrowers resulting from it. In particular small and medium-sized entities (SMEs) can benefit from this kind of information becoming aware of their strengths and weaknesses and realizing their equity and loan capital requirements. By knowing their internal ratings companies will more easily be able to determine their market positions as compared to competitors. The brochure is available online.
MittelstandsBlog think: The brochure is highly useful and should be read by any SMEs. GERMAN