Groups of enterprises can guarantee each other and form complex networks to obtain loans from commercial banks. During economic slowdown period, the corporate default may spread like a virus and lead to large-scale defaults or even systemic financial crises. To help the financial regulatory authorities and banks manage the risk brought by the networked loans, we identified the default contagion risk as a pivotal issue to take preventive measures, and develop iConVis, an interactive visual analysis tool , to facilitate the closed-loop analysis process. A novel financial metric - contagion effectis formulated to quantify the infectious consequence of the guarantee chains in the network. Based on the metric, we design and implement a serial of novel and coordinated views to address the analysis the financial problem . Experts evaluated the system using real-world financial data. The proposed approach grants them the ability to overturn the previous ad hoc analysis methodology and extends the coverage of the conventional Capital Accord in the banking industry.
Groups of enterprises can serve as guarantees for one another and form complex networks when obtaining loans from commercial banks. During economic slowdowns, corporate default may spread like a virus and lead to large-scale defaults or even systemic financial crises. To help financial regulatory authorities and banks manage the risk associated with networked loans, we identified the default contagion risk , a pivotal issue in developing preventive measures, and established iConVis, an interactive visual analysis tool that facilitates the closed-loop analysis process. A novel financial metric , the contagion effect, was formulated to quantify the infectious consequences of guarantee chains in this type of network. Based on this metric, we designed and implement a series of novel and coordinated views that address the analysis of financial problems . Experts evaluated the system using real-world financial data. The proposed approach grants practitioners the ability to avoid previous ad hoc analysis methodologies and extend coverage of the conventional Capital Accord to the banking industry.
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