Search
 
Analysis

Credit Markets Broaden View of Risk and Portfolio Diversification

As global monetary policy tightens, corporate treasury teams should be re-evaluating their risk management profile to reduce their exposure to risky customer accounts.

By Ranjini Pillay & Andrew Shapiro | October 06, 2022 at 07:59 AM
Stock illustration: different points of view

Geopolitical and economic turmoil is fueling global credit market disruptions and triggering a broadening view of portfolio risk exposure among corporate treasurers.

The confluence of complex financial marketplace dynamics has accelerated tightening of the credit markets. The first of these dynamics is inflation. Borrowers and lenders are taking a more cautious outlook on financial management as macro challenges emerge due to the inflationary pressures.

Central banks worldwide are raising rates in direct response to inflationary stress, to preserve market integrity and support recovery stability in the post-pandemic environment. According to The New York Times, in a business article that appeared on July 18, 2022, “at least 75 central banks lifted interest rates this year.”  The aggressive increases throughout 2022 have led to a global phenomenon of more expensive credit and higher default risk.

Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.

Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical Treasury & Risk information including in-depth analysis of treasury and finance best practices, case studies with corporate innovators, informative newsletters, educational webcasts and videos, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM websites including PropertyCasualty360.com and Law.com.

Already have an account?

NOT FOR REPRINT

© 2023 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Dig Deeper

 

Recommended Stories

Treasury & Risk

Join Treasury & Risk

Don’t miss crucial treasury and finance news along with in-depth analysis and insights you need to make informed treasury decisions. Join Treasury & Risk now!

  • Free unlimited access to Treasury & Risk including case studies with corporate innovators, informative newsletters, educational webcasts, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM publications including PropertyCasualty360.com and Law.com.

Already have an account? Sign In Now
Join Treasury & Risk

Copyright © 2023 ALM Global, LLC. All Rights Reserved.