Explain the following hypothetical table: $$\begin{array} { | l | c c c c c | }
\hline { \begin{array} { l }
\text { Risk grade at } \
\text { beginning of } \
\text { year 1 }
\end{array} } & { \text { Risk grade at end of year } } \
&1 & 2 & 3 & 4 & \text { Default } \

\hline 1& 0.86 & 0.08 & 0.03 & 0.02 & 0.01\
\hline 2 & 0.04 & 0.84 & 0.05 & 0.04 & 0.03 \
\hline 3 & 0.02 & 0.08 & 0.81 & 0.05 & 0.04 \
\hline 4 & 0.01&0.03&0.10&0.78&0.08\
\hline
\end{array}$$ In this context, explain the concepts of loan migration and migration analysis.

Question

Explain the following hypothetical table: $$\begin{array} { | l | c c c c c | } 
\hline  { \begin{array} { l } 
\text { Risk grade at } \
\text { beginning of } \
\text { year 1 }
\end{array} } & { \text { Risk grade at end of year } } \
 &1 & 2 & 3 & 4 & \text { Default } \

\hline 1& 0.86 & 0.08 & 0.03 & 0.02 & 0.01\
\hline 2 & 0.04 & 0.84 & 0.05 & 0.04 & 0.03 \
\hline 3 & 0.02 & 0.08 & 0.81 & 0.05 & 0.04 \
\hline 4 & 0.01&0.03&0.10&0.78&0.08\
\hline
\end{array}$$ In this context, explain the concepts of loan migration and migration analysis.

Quizplus · Accepted Answer

The Answer of Explain the following hypothetical table: $$\begin{array} { | l | c c c c c | } 
\hline  { \begin{array} { l } 
\text { Risk grade at } \
\text { beginning of } \
\text { year 1 }
\end{array} } & { \text { Risk grade at end of year } } \
 &1 & 2 & 3 & 4 & \text { Default } \

\hline 1& 0.86 & 0.08 & 0.03 & 0.02 & 0.01\
\hline 2 & 0.04 & 0.84 & 0.05 & 0.04 & 0.03 \
\hline 3 & 0.02 & 0.08 & 0.81 & 0.05 & 0.04 \
\hline 4 & 0.01&0.03&0.10&0.78&0.08\
\hline
\end{array}$$ In this context, explain the concepts of loan migration and migration analysis.

Explain the Following Hypothetical Table In This Context, Explain the Concepts of Loan Migration and c