According to Intrum Justitia, bad debts of more than € 350 billion were written off in Europe in 2013, which is around three percent of all outstanding transactions. Internal research into Dutch companies with debtor portfolios in excess of € 250 million reveals that some companies have had to write off up to 10 percent of their net result on their customers. According to some estimates, around 25 percent of companies actually go bankrupt due to bad debt losses alone. It is with good reason that many annual reports state that credit risks are often the biggest threat to business continuity. In this article, we explain our approach to credit risk management for corporates.
Credit ratings are becoming more common in the public sector. A credit rating is a report on the financial health of a company or institution. However, directors and finance managers often regard the rating process as a bit of a mystery. As far as Zanders consultants Charles Zondag and Hendrik Pons are concerned, it is certainly worth getting to grips with the dynamics of credit ratings.