Default risk broadly eased among publicly traded companies in the U.S. in the second quarter of 2024.^[1] S&P Global Market Intelligence's RiskGauge model recorded a lower median probability of default scores across six of 11 sectors as of June 30, compared to a quarter earlier. The scores represent the median odds of default on debt within a year and are based on financial reports and the volatility of share prices for public companies on major U.S. exchanges, accounting for country- and industry-related risks and other macroeconomic factors.

While energy, consumer discretionary, materials and healthcare all reported quarter-over-quarter rises in median default risk scores, defaults should slow down in the coming months, according to S&P Global Ratings. That said, slower economic growth and high interest rates that force companies to refinance debt at greater cost continue to pressure companies, making it imperative to keep a close eye on developments.

Members of the sales team at this investment bank needed to assess the creditworthiness of different companies to determine whether a loan should be offered and, if so, at what price. Given today's volatile market conditions, the financial stability of companies and any signs of potential credit deterioration.

Lending teams need ready access to the most up-to-date data to effectively assess creditworthiness and probability of default in this volatile market environment.

Pain Points

Members of the sales team wanted to create profiles of customers and prospects in their CRM system that would include measures of creditworthiness that could be quickly updated as new data was available. They were currently creating basic profiles manually, which was time consuming and did not include important signals that could impact a lending decision. The team wanted to:

• Enrich their own credit modeling results with additional information on creditworthiness.
• Create a centralized view of a company so all bankers are able see the same information for consistent evaluations.
• Incorporate data on ownership and transactions to complete the picture.
• Analyze overall exposures across all clients to look at trends.
• Have the profiles continually refreshed with the latest data to support timely decision-making.

The team was already a client of S&P Global Market Intelligence ("Market Intelligence") and contacted their relationship manager to discuss this new initiative.

The Solution

Specialists from Market Intelligence discussed RiskGauge Scores that measure a company’s financial performance and how it is trending with credit scores shown on a lower letter grade scale from ‘aaa’ to ‘d’. They then described several company datasets that would help round out the picture. Finally, they described a range of delivery options for quickly embedding this data into the CRM profiles. This included S&P Global Reverse ETL, an intuitive point-and-click technology that enables firms to effortlessly integrate trusted S&P Global data into their business tools ‒ like Salesforce, HubSpot, Microsoft Dynamics and more ‒ without code. This eliminates manual data entry and complex mapping processes, enabling non-technical users to set up essential business pipelines. The datasets together with the delivery option of choice would enable the sales team to:

	Obtain consice estimates of lending risk	RiskGauge provides credit scores that align to S&P Global Ratings probabilities of default or a scale of 1-100 using extensive public and private datasets or internal data. Pre-calculated scores are also instantly available, covering small- and medium-sized enterprises, large corporations and financial institutions. Scores can be launched into the CRM profiles providing comparable and consistent credit assessments across sectors and geographies.
	Understand a company's business	Company Intelligence provides profiles of public and private firms worldwide, including company contact information, competitors, financial auditors and summary or detailed-level business descriptions.
	Gain additional company insight	The Ownership dataset provides detailed institutional, mutual fund and insiders/individuals equity share ownership data for public companies, along with public float shares, buys and sells of insiders and major shareholders. In addition, users can access deep insights into portfolio data on investments for institutions and funds. This dataset can be used to track market momentum and identify the frequency by which assets within a fund are bought and sold.
	Dig deeper on corporate activity	The Transactions dataset provides the entire lifecycle of primary and secondary market business transactions, across public offerings, private placements, mergers and acquisitions, buybacks/repurchases, corporate restructuring, bankruptcies, spin-offs and split-offs. It provides 2M+ high-quality transactions across the globe.
	Link related data for a company	The Business Entity Cross Reference Service (BECRS) dataset automates the linking process. It provides immediate cross-reference capabilities for millions of public and private entities using standardized and proprietary identifiers, including: EINs, global tax IDs, VAT IDs and local registration IDs. Rating IDs from S&P Global, Moody's and Fitch. D&B Duns IDs, Legal Entity Identifiers (LEI), CUSIPs and Money Market Directories (MMD) IDs. …and more.
	Streamline the flow of data into the company's CRM system	A range of delivery options are available, including the XpressfeedTM data feed service, APIs, cloud-based Snowflake and S&P Global Reverse ETL that revolutionizes data activation by automating the data enrichment of sales and marketing tools. Multiple options can be chosen for different purposes.

Key Benefits

Members of the sales team saw the benefit of having this rich data seamlessly delivered to the company's internal applications. They decided to use Xpressfeed to capture data for their internal models and S&P Global Reverse ETL for enriching the CRM profiles with real-time, actionable insights. They can now:

• Minimize potential losses by using the latest available information to assess loan prospects and price deals accordingly.
• See overall and sector-level trends with centralized CRM data that reflects the entire loan portfolio.
• Save time and reduce errors by replacing manual data integration with smarter, more efficient approaches to data delivery.