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Internal Rating Systems and the Bank-Firm Relationship: Valuing Company Networks
Summary: “In response to the complexity of the corporate environment and
competition, companies are seeking a new organizational set to maintain their
competitive advantage. Various empirical studies have been conducted which
demonstrate firms’ abilities to increase value through network creation. From
a lender’s point of view, a member of a network deserves more attention and a better
rating because it is seen as innovative in pursuing internationalization and overcoming
a size gap and any capital shortage. This book provides the conceptual and operational
tools for understanding the mechanisms for assigning a rating to a network of
companies. In it, the author explores the rating systems of corporate networks
and analyses the link between rating and an enterprise network. The first part of
the book investigates the criteria for the classification of networks and the methods
and types of inter-company connections. The second part of the book configures
possible paths of rating assignments in relation to the quantification of a corporate
network. The third part of the book addresses practical guidelines for quantifying
the award-network and proposes possible ways of rating assignment. Finally, the
author offers insight and practical guidelines for the quantification of the “premium
network”, examining the real worth of network rating to a corporation. This book
offers theoretical and practical insight into a topic of significance to anyone with an
interest in credit and risk management, banking, accounting and finance. It is an
excellent source of research for students and teachers alike, and a valuable reference
work for undergraduate, post-graduate and PhD students in relevant
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