PICM Risk Index ©

//PICM Risk Index ©

Why PICM Risk Index ©?

In a dynamically changing environment, analysts, including credit managers, are looking for the so-called High-Frequency Indicators of Economic Activity (IEA) or other data helping to assess the current state of economic activity. This is important, especially in the absence of current information on the financial results of enterprises that do not publish current financial information. Therefore, we invite you to familiarize yourself with the PICM Risk Index ©, which is calculated monthly for all industries and enterprises of all sizes in Poland.

The PICM Risk Index © indicators are based on long-term time series of business tendency trends provided by the Polish Central Statistical Office. The PICM Risk Index © ranges from 0 to 100, where the higher the value of the index, the higher the risk of insolvency of companies in a given industry. It is assumed that a significant risk arises when the indicator exceeds 50 points.

The purpose of the PICM Risk Index © is to supplement the detailed solvency analysis of a single enterprise with a more general risk measure, the risk of the industry in which the enterprise operates. This can be compared to the fundamental analysis of a listed company where the end result is the determination of the value of the enterprise (share). At the end of the credit analysis, we define the risk class. The stages preceding this are basically the same, i.e. analysis of the financial standing, analysis of the macro-environment and the industry environment. The PICM Risk Index © gives a picture of risk just for the industry environment. The interactive graphics below show sample PICM Risk Index © presentations for selected industries.

Why Use PICM Risk Index ©?

  • No financial statements: The level of industry risk can be useful in assessing customer risk without financial statements
  • Scoring model: The level of industry risk may be an additional element of the scoring model for clients with financial statements
  • Early warning signals: in a dynamically changing environment, current information is important to assess the potential risk of insolvency

Detailed PICM Risk Index © readings are available for logged in PICM Associate (PICMa) in the Credit Manager Area.

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Any enquiries? please contact:
Robert Dyrcz, PICM
+48 600 093 372