Sh Suhyup Bank will jointly develop a corporate credit analysis platform with Korea Rating Data to analyse the financial soundness and potential risks of companies not subject to external audits.

Suhyup Bank said on Aug. 4 it signed a business agreement on Aug. 3 at Korea Rating Data’s headquarters to jointly develop the PRISM Credit Risk Platform.

PRISM is named after the initials of Probability, Risk Drivers, Internal Structure and State Migration.

While existing credit analysis provided information centred on a single risk probability, PRISM will be developed to comprehensively analyse a company’s current financial condition, the causes of risk events, areas of risk concentration and the direction of future change.

The two companies plan to jointly design everything from expert judgment standards to result interpretation and an operational application framework by combining Suhyup Bank’s corporate risk management experience with Korea Rating Data’s corporate information and analysis capabilities.

The platform will also reflect a corporate credit analysis checklist developed by Yang Ki-tae (양기태), deputy head of the Risk Management Group at Suhyup Bank. It will combine explainable AI-based machine-learning technology with expert corporate analysis standards so users can check the causes of financial conditions, risk measurement methods and detailed inspection items.

It will also include non-financial information and risk information that may arise from transactional relationships as targets for analysis. The platform will be structured so practitioners with little experience in financial analysis can identify risk factors that should be checked first.

After completing platform development, Suhyup Bank and Korea Rating Data plan to apply it to the financial sector’s credit screening, post-management and early-warning tasks for lending to non-audited companies.

They also plan to expand its use to areas such as financial analysis of counterparties for general companies and supply chain risk management.

Yang said, "We designed it to systematically track the causes of a company’s financial condition, risk measurement methods and areas where potential risks are concentrated by combining explainable AI-based machine learning with an expert checklist."

Shin Hak-gi (신학기), CEO of Suhyup Bank, said, "Through PRISM, we will advance the financial sector’s credit management system and build corporate credit analysis infrastructure."