A credit analyst [1][2] is a person employed by an organization to analyze the credit worthiness of customers and potential customers, and to assist in the ongoing management and modeling of credit risk thereafter. See Credit analysis § Role and Financial analyst § Corporate and other for discussion. In May 2015, the U.S. Bureau of Labor Statistics reported 70,840 people employed as credit analysts. The salary for this position ranged from $40,250 to $134,080 with a mean average wage of $79,720.[3]

In investment banks, "quants" are responsible for the analytics related to the risk management and regulatory capital due to credit risk on the banking book (and to pricing and hedging credit derivatives). This position is distinct from the more commercially-focused credit management role described in this article.

Job responsibilities

Job responsibilities include the following:[4]

  • Reviewing credit applications
  • Projecting sales
  • Evaluating credit risk
  • Analyzing financial data, statements and trends
  • Setting new customer credit limits
  • Recommending credit limits based on company credit policies
  • Performing credit reviews of existing customers
  • Maintaining customer files with financial statements and bank reference information
  • Resolving credit issues
  • Monitoring risk trends on behalf of management and sales personnel

Education

Credit analysts typically [2] hold a business related bachelor's degree majoring in finance, in accounting, in business administration, or in economics. Depending on the role, some companies may require a professional certification such as the Credit Business Associate from the National Association of Credit Management (NACM). [5]

Particularly for analysis involving the technical elements of EAD, PD and LGD modelling, some quantitative training, specifically in statistics and calculus, will be required.[1] Often, a math or actuarial degree, and / or the FRM or PRM certification may be recommended. See also Quantitative analysis (finance) § Education.

Professional Organizations

Credit analysts in the United States can obtain memberships, continuing education and certification through NACM. Certification levels include Credit Business Associate, Certified Credit and Risk Analyst, Credit Business Fellow, Certified Credit Executive, Certified International Credit Professional and International Certified Credit Executive.[6]

See also

References

  1. 1 2 Staff (2019). Credit Risk Measurement and Management
  2. 1 2 C. Morah (2021) Analyzing a Career in Credit Analysis, investopedia.com
  3. ↑ "Credit Analysts". www.bls.gov. Retrieved 2016-07-07.
  4. ↑ "Careers in Credit - NACM North Central". nacmnc.org. Retrieved 2017-11-28.
  5. ↑ "How Do I Become a Credit Analyst?". Retrieved 2016-07-07.
  6. ↑ NACM. "The National Association of Credit Management: Certification Programs". nacm.org. Retrieved 2016-07-07.
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