Sep 16, 2015

Credit Risk Assessment VS Distressed Debt Analysis


From Distressed Debt Analysis:

Credit risk analysis and distressed debt analysis are similar exercises; it is just a question of when they are performed. By analogy, credit risk is like standing on a dock under tranquil skies and calmly discussing the risk that a boat carrying gold might capsize should an unexpected storm arise; distressed debt analysis is like being on the boat in a hurricane and deciding how much to offer to buy it, recognizing that the boat could sink or it might be necessary to throw some of the gold overboard to survive.

Categories: Theory

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