The COVID crisis highlights that no business is safe and even if your business is safeguarded if a risky business is connected to yours, its collapse could well lead to the downfall of your operation. In recent years businesses are facing increasingly strict legislation and heightened requirements for good governance, risk management and accountability. In the decade since the financial crisis, credit risk has gone from being a brushed off part of doing business to a strategic measure.

This course will deal with the following topics:

• What is credit risk and why is it important?
• What drives credit risk?
• How can credit risk be analyzed using rating technology and financial data?
• How can credit risk be measured?
• How can credit risk be managed?

The aim of this course is to introduce students to credit risk. Upon completion of the course students will 

• have a theoretical understanding of credit risk
• be familiar with the different sources for credit risk both for financial and non-financial companies
• be able to quantify credit risk based on credit risk measures
• be able to interpret credit risk measures both on a quantitative as well as qualitative level
• have a basic understanding of how credit risk can be managed

Due to the COVID-Crisis, this is an online course, attendance will be required in synchronous course sessions.

This course is designed as a flipped classroom course using MS Teams and Learn@WU. Asynchronous teaching (screencasts and videos) will be released at the stated intervals. Synchronous sessions will be held for Q&A and practice purposes. Synchronous session will be held prior to the homework exercises and the final exam.

Homework Exercise A (15%)

Homework Exercise B (15%)

Final Exam (70%)

Grading scale (in points)

 >= 87,5      1

 75-87,5      2

 62,5-75      3

 50-62,5      4

 < 50           5