Credit Risk Analysis in Distressed Debt, Rating Methodologies, and CDS Training Course

Credit Risk Analysis in Distressed Debt, Rating Methodologies, and CDS Training Course

Introduction

Credit risk analysis is a cornerstone of modern financial management, enabling institutions to assess borrower reliability, identify distressed debt opportunities, and evaluate counterparty exposure through sophisticated rating methodologies. With global markets facing volatility, credit default swaps (CDS) have emerged as essential hedging instruments for managing systemic risk. Credit Risk Analysis in Distressed Debt, Rating Methodologies, and CDS Training Course integrates practical tools and advanced strategies to help participants navigate credit ratings, distressed debt restructuring, and CDS valuation with confidence.

Designed for financial professionals, risk analysts, investment managers, and regulators, this course emphasizes credit risk modeling, debt restructuring, counterparty risk management, sovereign risk evaluation, and derivative applications. By combining real-world case studies and best practices, participants will gain in-depth expertise in analyzing distressed debt portfolios, interpreting rating agency methodologies, and using CDS as effective instruments for risk mitigation in today’s complex financial markets.

Course Objectives

1. Understand the fundamentals of credit risk analysis in global financial markets.
2. Analyze distressed debt investing strategies and restructuring mechanisms.
3. Evaluate rating methodologies applied by major credit rating agencies.
4. Apply quantitative credit risk models for portfolio management.
5. Assess default probabilities and credit migration risks.
6. Explore the structure and pricing of credit default swaps (CDS).
7. Understand the role of credit derivatives in hedging systemic risk.
8. Examine sovereign credit risk and country ratings.
9. Apply Basel III/IV frameworks in credit risk regulation.
10. Interpret market indicators for early warning signals of distress.
11. Explore counterparty credit risk management in derivative markets.
12. Study the impact of ESG factors on credit ratings and distressed debt.
13. Apply case study analysis of real distressed debt and CDS transactions.

Target Audiences

1. Credit Risk Analysts
2. Investment Bankers
3. Portfolio Managers
4. Rating Agency Professionals
5. Financial Regulators
6. Corporate Treasurers
7. Hedge Fund Managers
8. Risk Management Consultants

Course Duration: 5 days

Course Modules

Module 1: Fundamentals of Credit Risk Analysis

• Principles of credit risk assessment
• Key drivers of creditworthiness
• Role of default probability and recovery rates
• Credit risk in financial markets
• Analytical frameworks for risk measurement
• Case Study: Credit risk assessment of a corporate borrower

Module 2: Distressed Debt and Restructuring Strategies

• Characteristics of distressed securities
• Debt restructuring techniques
• Legal frameworks in distressed investing
• Valuation of distressed debt instruments
• Investor strategies in distressed markets
• Case Study: Lehman Brothers distressed debt workout

Module 3: Rating Methodologies

• Role of rating agencies in financial markets
• Sovereign vs. corporate rating methodologies
• Internal vs. external credit ratings
• Key rating determinants and outlook analysis
• Implications of rating downgrades/upgrades
• Case Study: Rating methodology applied to Greece’s sovereign downgrade

Module 4: Quantitative Models in Credit Risk

• Structural credit risk models (Merton, KMV)
• Reduced-form models for default probability
• Credit scoring techniques
• Credit risk stress testing
• Portfolio-level credit risk modeling
• Case Study: CreditMetrics application in portfolio risk

Module 5: Credit Default Swaps (CDS)

• Structure and mechanics of CDS contracts
• Pricing models for CDS
• CDS indices and market applications
• Hedging credit exposure with CDS
• Regulatory implications of CDS trading
• Case Study: AIG and CDS during the 2008 financial crisis

Module 6: Counterparty Credit Risk

• Understanding counterparty exposure
• Netting and collateral management
• Wrong-way risk in derivatives trading
• Credit Valuation Adjustment (CVA)
• Managing exposure in OTC derivatives
• Case Study: JPMorgan’s “London Whale” and counterparty risk

Module 7: Sovereign Credit Risk & ESG Factors

• Country risk assessment frameworks
• Sovereign bond spreads and ratings
• Macroeconomic indicators in sovereign analysis
• Role of ESG factors in credit risk evaluation
• Policy and geopolitical risks
• Case Study: Argentina sovereign default analysis

Module 8: Integrated Credit Risk Management

• Holistic approaches to credit risk governance
• Integration of regulatory frameworks (Basel III/IV)
• Credit portfolio diversification strategies
• Stress testing and scenario analysis
• Early warning systems for credit distress
• Case Study: Credit portfolio stress testing in a European bank

Training Methodology

• Interactive lectures with real-life examples
• Case study analysis of global credit events
• Practical workshops on CDS pricing and risk models
• Group discussions and problem-solving exercises
• Hands-on simulations using credit risk tools

Register as a group from 3 participants for a Discount

Send us an email: [email protected] or call +254724527104 

Certification

Upon successful completion of this training, participants will be issued with a globally- recognized certificate.

Tailor-Made Course

 We also offer tailor-made courses based on your needs.

Key Notes

a. The participant must be conversant with English.

b. Upon completion of training the participant will be issued with an Authorized Training Certificate

c. Course duration is flexible and the contents can be modified to fit any number of days.

d. The course fee includes facilitation training materials, 2 coffee breaks, buffet lunch and A Certificate upon successful completion of Training.

e. One-year post-training support Consultation and Coaching provided after the course.

f. Payment should be done at least a week before commence of the training, to DATASTAT CONSULTANCY LTD account, as indicated in the invoice so as to enable us prepare better for you.