Counterparty Risk Appraisal Reports & Ratings

Infospectrum’s globally recognised Counterparty Risk Appraisal Reports & Ratings are integral to the risk-management, trade approval, and compliance processes of clients across the shipping, commodities, and energy markets. Produced to order, each report is thoroughly, yet discreetly, researched by our highly experienced Analysts, and provides critical insight into the ownership, operations, financial position, ESG profile, and market standing of subject entities (and any relevant wider group). Featuring our assigned ratings, the reports can also collectively facilitate risk benchmarking across a portfolio of counterparties.

Counterparty Risk Appraisal Reports & Ratings are delivered to the strict deadlines that time-sensitive shipping and trading transactions call for. We produce 400 to 500 reports and ratings per month, and upon completion, each is immediately made available for download via our online Infospectrum Portal, which gives users instant, 24/7 access to 30,000+ Counterparty Risk Appraisal Reports & Ratings.

"We depend on Infospectrum Reports to provide independent, accurate business information we can confidently rely on. We view Infospectrum's analysts as extensions to our own team, and continually benefit from their industry knowledge and informed judgements. Their ability to meet urgent deadlines is essential to our business and key to concluding time sensitive deals with our customers.”

(Compliance Manager - Ocean Transport Division of Global Trading House)

What to expect from Infospectrum Counterparty Risk Appraisal Reports & Ratings

Company Identity & Details
History
Operations
Recent Developments
Fleet
Financials & Financial Commentary
References & Sanctions
Ratings & Assessment

Company Identity & Details

Confirms the existence and unique legal identity of the subject entity (supporting validation of contractual counterparty details)

Confirms the entity’s registered legal (often brass-plate) domicile, in distinction from its trading location

Distinguishes legal identity from any trading name or brand that the entity may utilise

Provides a ready and succinct indication of vital KYC details, identifying shareholders, actual or perceived UBOs, Directors, key management figures, and constituents of any wider group to which the entity may belong

Provides insight into KYC details that are often obscured by the use of low-disclosure domiciles or nominee shareholders and Directors

Leverages Infospectrum's 20+ years’ experience in conducting targeted (yet discreet) research to provide clarity required on the foregoing, allowing for sanctions and other due diligence checks to be carried out against pertinent entity and principal names

History

Charts the development of the subject entity (and any relevant wider group), from its origins, through to the present day

Looks to profile the entity’s shareholders/UBOs and leadership team, giving insight into experience and track records (responses to market developments, achievements in capital-raising and rendering financial support, adverse media, etc.)

Outlines the strategies pursued over time, and the impact of these (upon the entity’s operations, asset base, structure, growth, market position and finances)

Operations

Clarifies the precise contractual remit of the subject entity (supporting validation of proposed contractual counterparties), in distinction from that of affiliates or associates

Profiles the fleet, assets and commodities commercially exploited by the entity

Identifies the entity’s core strategic business model

Highlights the scale, scope, and diversification of the entity and any relevant wider group

Highlights the structure and application of risk management systems

Considers the entity’s own operations in the context of those of any wider group. This allows for the identification of related party transactions, which at times, can obscure the true scale of the business and scenarios where risk is transferred to other parts of a relevant group, which, in adverse market situations, may have an impact on the subject

Recent Developments

Highlights events or emerging trends (internal or external to the entity or relevant wider group) that we identify as potentially influencing the performance or profile (and therefore financial, counterparty or credit risk profile) of the entity/wider group.
Coverage may include matters such as a shift in pertinent market fundamentals, developments pertaining to the strategic direction of the business, pending changes to the ownership or management profile, corporate restructuring, evolving ESG initiatives, etc.

Fleet

Key data on vessels identified as pertinent to the subject entity's operations.

Financials & Financial Commentary

Assessing the financial condition of an entity, or any relevant wider group, is a key component of our analysis

Wherever possible, we source the latest available financial accounts (from corporate registries, local agents, or the entity’s own management) and detail the key items, for user reference, and as a partial basis for our financial assessment

While the inclusion of accounts data (where available) gives material insight into recent financial performance and balance sheet profiles (leverage, liquidity, presence of tangible assets, changes in the foregoing, etc.), our financial assessments extend well beyond consideration of such details.

Wherever possible, we will present management comments on the development of the financial position (and outlook) subsequent to the latest reported accounting period, combined with our analysis of possible development, given the entity’s positioning, commitments, trade and economic conditions, etc.

As the need for transparency and financial disclosure is increasingly recognised, Infospectrum will, in certain cases, gain sight of financial accounts shared confidentially by the entity’s management; in these circumstances, figures may not be expressly stated in our report, but they will nonetheless form a partial basis for our financial and overall assessments

In the absence of any available financial data, we will always look to provide meaningful estimates of financial scale and performance (including alluding to balance sheet profile possibilities), in consideration of material factors (such as the subject entity’s operational profile, recent market conditions, creditor intelligence, etc.)

References & Sanctions

Trade reference information relating to the payments and operational performance of a subject entity is obtained from our global network of well-placed market sources

The subject's reported payments performance is profiled, be it presented as always punctual, generally sound, historically negative, deteriorating or improving, etc.

We look to ascertain how performance is demonstrated in several sectors (e.g., chartering, consumables supply, etc.) and illustrate whether such performance is within or beyond norms for each sector, or is deemed acceptable by reference sources

Insight on the current standing and track record of the principals and management team is provided where possible

Extensive public record searches are conducted, as we seek to build a view of the subject entity’s adherence to regulatory, environmental, social, and corporate governance (ESG) standards, and identify any adverse media

We perform checks to confirm the sanctions status of the subject entity, its shareholders, UBOs, Directors, and directly relevant affiliates and vessels (where applicable)

Port State Control inspection records are searched, and deficiencies and detentions reported against relevant vessels are highlighted

Ratings & Assessment

Infospectrum’s unique and proprietary methodology combines human intelligence with data-centric research to deliver counterparty due diligence on a real-time basis.

Our methodology is designed to address the intrinsic characteristics of the shipping, commodities, and energy sectors: private, small to medium-sized enterprises, incorporated in low disclosure jurisdictions with limited documentary transparency, multiple ownership structures and related party transactions, set against sector cyclicality, volatility, and evolving regulation.

Financials are an important component of our analysis, although in many cases, such disclosures, if available, are only produced annually, often, long after the end of the financial period covered, thus our approach extends well beyond public disclosures and market data, with intelligence sourced via trusted market source networks

Data and intelligence from multiple channels are authenticated, validated, and contextualised by our Analysts via Infospectrum’s proprietary Multiple Factor Verification framework

Systematically processed information feeds Infospectrum’s ratings model, which analyses compliance and governance related risks (such as transparency, ownership and structure, and public records) alongside company and sector related criteria (track record and market presence, strategic, operational and financial performance, and market feedback) to arrive at an alpha-numeric rating

Our Ratings & Assessment section critically weighs key factors determined in our research and assessment process, and provides Ratings for each subject based on six measures (with trend indications):

Financial Scale: An indication of turnover range, and positive or negative bottom-line performance

Overall Performance: Our perception of the company's performance, relating to operational and financial performance (in prevailing market conditions) and commercial morality

Payment Performance: Our assessment of the subject’s reported payments performance

Credit Opinion: Our suggested level of credit exposure (in USD); if secured trading is the norm, this is indicated

Overall Rating: Defining the perceived risk of default, on an incremental scale

Suggested Review Period: The timeframe (expressed in months) within which we would suggest a further review of the subject account

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