Corporate Lending - Analyse your corporate lending portfolio

• In-depth analysis of climate-related risk by sector and geography at a client level
• Assess risks without the need for client-provided information, using XDI’s proprietary databases
• Test counterparty risk ratings under different climate scenarios
• Deep dive on high risk clients for further engagement on climate resilience

How did XDI help?

Using proprietary and third party databases, XDI was able to identify owned, operated and leased assets for each company in the client’s portfolio.

The use of databases avoided the need to approach each customer individually, reducing implementation time and pressure on frontline teams.

Having established the asset profiles of each counterparty, XDI performed risk analysis under a range of climate change scenarios. The client was able to identify hotspots of climate risk and areas of the portfolio where further analysis would be needed.

Results

Metrics provided to the client included:

• Maximum-to-Date Value at Risk
• Technical Insurance Premium
• Productivity Loss
• Failure Probability
• Primary hazards driving risk
• Sectoral and geographic breakdown

Outputs from the analysis were used in different ways. Firstly to understand overall performance of the corporate lending portfolio under different climate scenarios; and secondly to conduct sensitivity analysis on credit risk ratings using metrics such as Productivity Loss. 

What next?

XDI’s independent analysis of corporate loan portfolios allowed the bank to enhance its climate strategy with its institutional banking clients. By identifying higher risk counterparties, it was able to explore climate resilience strategies in future client engagements, alongside existing net-zero plans.