William Haney, Credit Benchmark

Credit Benchmark launches new monthly measure of credit risk for US, UK and EU industrials


Credit Benchmark, a specialist in consensus based credit analytics, has launched a new monthly measure of credit risk for US and European corporates in the industrials sector. 

The Credit Benchmark Credit Consensus Indicator (CCI) is an index of forward-looking credit opinions for US, UK and EU Industrials based on the consensus views of over 30,000 credit analysts at 40 of the world’s leading financial institutions.

Drawn from more than 750,000 contributed credit observations, the CCI tracks the total number of upgrades and downgrades made each month by credit analysts to chart the long-term trend in analyst sentiment for industrials. A monthly CCI score of 50 indicates neutral credit quality, with an equal number of upgrades and downgrades made over the course of a month. Scores above 50 indicate that credit quality is improving. Scores below 50 indicate that credit quality is deteriorating.

“Credit Benchmark has become the largest source of credit risk data for rated and un-rated entities, and we are committed to leveraging that unique level of visibility to create the kinds of timely, insightful benchmarks market participants need to accurately evaluate their credit risk exposures,” says William Haney, CEO of Credit Benchmark. “With the CCI, we’ve developed a timely snapshot of credit risk for US and European industrials that offers a tremendous amount of insight in a concise, easy-to-follow index.”

The June CCIs show rising credit risk in the UK and EU, but a slight improvement in the US. The UK CCI for June is 49.6 and has been in deteriorating territory for the past six months. The EU CCI for June is 49.6, the first dip below 50 in three months. The US CCI for June is 50.9, after two months of deterioration. Most months in 2018 showed improvements in the US but the picture is now more mixed.

“Recent CCIs indicate pessimism among analysts tracking industrials, especially in the UK, and less optimism in the EU,” says David Carruthers, Credit Benchmark Head of Research. “And the long term trend for US industrials suggests that the positive bump associated with the Trump tax cuts has now worked its way through the system, and we’re now seeing some cracks appearing in the credit quality foundations.”

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