Use hidden relationships to gain a better understanding of total credit exposure based on guarantees among related parties – both individuals and corporations
The creditworthiness of any entity — individual or business — depends not only on the entity’s own financial condition, but also on the nature of its business and its exposure to risk from interrelated guarantees and financial commitments, such as equity calls from related parties.
Third-party data sources can identify financial relationships between a business customer’s address, parent company, headquarters and ultimate owner. Individuals can be connected to companies — including privately-held companies — enabling ISI’s unique Synchronos™ relationship-building software to construct a comprehensive network of a customer’s financial relationships. This holistic profile, which reveals credit relationships that might otherwise remain hidden, provides a much sounder foundation on which to determine an entity’s potential risk than the traditional credit search. This is especially true in cultures that have non-hierarchical equity positions and cross-ownership positions, such as those common in Europe and Japan.
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