Credit Analysis is very exciting , enriching and challenging career in Finance.It is good for persons having sharp analytical skills and good quantitative aptitude. It is examining and evaluating the client’s financial and operational information to assess its creditworthiness.
The professional who examines and assesses these kinds of risks pertaining to the clients to whom they have to lend money is called “credit analyst”. For example when a firm is taking loan from the bank someone from the bank will come and examine that whether lending money to that particular company is safe or not.
These professionals are credit analysts. They analyse the financial data and information of a company through different sources like news reports, accounts sheets, balance sheets etc and judge the risk of lending credit to the clients.
These profesionals are employed in banks, investments banks, credit rating companies, mutual fund houses, asset management firms, equity houses and KPO’s as well. The work of a credit analyst is a desk job and requires a great deal of patience. The profession seeks person who is not very out going but like to meet people and loves doing research.
Day starts with checking mails and responding them, planning their work and discussing with the senior management. They analyse the financial reports and information related to industry, market and company (Client) for whom they are doing credit analysis and discuss the issues with the clients and finally prepare a credit analysis report.
It is not mandatory that students from background having the graduation in commerce can only opt for career in credit analysis though many employers ask for B.Techs, B.Com or C.A but Master’s degree is a must for a career growth . Many of the credit rating agencies recruit M.B.A Finance with a graduation in commerce. The pay packages of the credit analyst vary from their experiences and on the basis of the institution from where they have done the course. Initially salary varies from 5 lakhs to 6 lakhs a year and increment depends on the performances. The average pay of the CEO having a masters degree and rich experience between 15-20 years is approx 35- 40 lakhs per annum.
Credit analysis gives a diverse exposure for various industries and companies including big corporates , banks, small and medium enterprises etc. It gives a notion what companies are doing and which industry practices are followed by them.