Bank of Spain extends corporate information exchange pilot to Valencia to strengthen credit assessments

The Bank of Spain has extended to Valencia a pilot programme that exchanges information with large companies to improve its internal credit assessment system, ICAS BE. The programme began in June in Madrid and Barcelona. It collects information directly from companies and provides them with information about their credit ratings, helping them understand their risk profiles and potentially improve access to financing. Direct input from companies will supplement assessments previously based exclusively on the Bank of Spain’s databases and public sources, providing a more current understanding of their financial situation. Until now, the system has been used only for monetary policy purposes, to determine whether loans pledged by banks as collateral meet the Eurosystem’s credit quality requirements. The pilot is consistent with the bank’s previously outlined work to broaden the use of independent credit ratings to reduce information gaps and improve companies’ access to funding, particularly for small and medium-sized enterprises. While the pilot focuses on large companies, the bank expects to extend the programme after the pilot phase to all nonfinancial companies in Spain assessed by ICAS BE.