Could corporate credit losses turn out higher than expected? - Bis Bulletin no 46 - August 2021
mercredi 18 août 2021 BIS Visiter le site source Télécharger au format PDFKey takeaways
- Credit risk forecasts should provide information both about losses in a baseline scenario ("expected losses") and about the potential for extreme outcomes ("unexpected losses").
- Policy support measures have kept debt service costs low during the pandemic, thus underpinning benign baseline forecasts of corporate credit losses up to 2024.
- High indebtedness, built up when the pandemic impaired real activity, suggests increased tail risks: plausible deviations from the baseline scenario feature ballooning corporate insolvencies.