Migration Analysis Is a Tool to Measure Credit Concentration Risk

question 18

Multiple Choice

Migration analysis is a tool to measure credit concentration risk and refers to

• A)the identification of problem loans in sectors by observing periodic migration of industries.
• B)the identification of credit concentration by observing trends in market borrowing by different sectors of the industry.
• C)the identification of credit concentration by observing the downgrading or upgrading of credit ratings on securities in different sectors of industry by public rating agencies.
• D)the identification of borrowing patterns such as long or short term debt by different sectors of industry.
• E)the identification of shifts in debt/asset ratios of firms in specific industries.

---

Definitions:

Early Neutral Evaluation (ENE)

A process similar to that of a settlement hearing, which may result in a final decision or be used to help shape the final decision.

Mediation

A form of alternative dispute resolution where a neutral third party helps disputants reach a voluntary, negotiated agreement.

Arbitration

Arbitration is a form of alternative dispute resolution where a neutral third party, known as an arbitrator, makes decisions to resolve a dispute outside of court.

Advisory Verdict

A non-binding verdict given by a jury in a civil case, which serves only to advise the judge on certain aspects of the case.