Economic Review, Vol. 56 No. 9, 2005.
Professional paper
THE USE OF THE METHOD OF SIMULATION IN THE CREDIT RISK APPRAISAL
Damir Juričić
Abstract
The credit risk analyzing of a business system is a very compound process, which, depending on the methods applied, could be more or less accurate. By applying the method of simulation of numerous possible situations in which the observed business system could fi nd itself in the future, and by processing the results of the carried out simulations statistically, it is possible to get more accurate and more transparent quantification of the actual credit risk degree, i.e. credit repay risk. The autor of this article presents the elements of the simulation method and the significance of the debt service cover ratio and cumulative debt service cover ratio (DSCR and CDSCR) as the measures of credit risk
Keywords
Hrčak ID:
10407
URI
Publication date:
25.9.2005.
Visits: 10.165 *