From p13 https://www.westpac.com.au/content/d...ember_2019.pdf
Corporate loans carry an RWA value of:
$74,807m/$139,173m = 0.54.
Comparing that 'averaged' figure to the table (below) it looks like the 'typical' loan might be thought of as "A" grade.
From page 7 https://www.bis.org/bcbs/publ/d424_hlsummary.pdf
External rating of General Corporate Counterparty RWA Factor AAA to AA- 20% A+ to A- 50% BBB+ to BBB- 75% BB+ to BB- 100% Below BB- 150% Unrated 100%
Yet even quite respected NZX listed businesses seem to have a significantly lower credit rating than that.
Contact Energy BBB
Sky City BBB-
Skellerup (?)
Spark A-
Turners Automotive Group (No rating)
I have trouble thinking how an 'averaged portfolio of corporate debt' can have an averaged Risk Weighted Asset factor just shy of grade 'A'.
SNOOPY
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