Credit Analysts evaluate the risk factors that may influence loan applications and approvals. In this regard, they are in charge of collecting and examining the financial background of applicants; hence, Credit Analysts analyze clients’ paying records, incomes, and savings history thoroughly in order to determine whether a person will be able to pay back the requested loan. They also establish what credit limit the interested party should obtain.
The Credit Analyst’s position is easily confused with the one of Loan Officer. The latter assists clients throughout the entire process; they start by explaining the types of loans and their terms to subsequently conduct the verification and analysis of applicants’ financial records and circumstances, in order to determine if they qualify for a loan’s approval. On the other hand, Credit Analysts focus on examining clients’ credit-related information (e.g. financial statements and financial data updates) in order to determine the financial risk that may take place in case of being conferred a credit.
Credit Analysts can be found in a wide variety of establishments, from financial institutions and agencies to more specialized companies in areas such as Insurance or Investment.
Here’s a non-exhaustive list of common tasks Credit Analysts are required to complete.
- Supporting new and current clients on credit products:
- Setting up meeting with clients to obtain information on their financial background and to identify their needs and objectives;
- assessing applicants’ earning and spending capacity, as well as determining their assets and financial liabilities; and
- promoting credit lines and products attending to clients’ financial needs and goals.
- Providing accurate and prompt analysis of clients’ financial record, estimating the risk that would represent to approve a credit or loan:
- Examining financial statements and reports, debt schedules, projections, tax returns, balance sheets, and any other financial documentation thoroughly;
- analyzing the trends observed in the documentation reviewed;
- highlighting any abnormality or information gaps denoted;
- determining risk factors;
- examining clients’ payment source;
- determining interest rates and applicable ratios based on clients’ financial records; and
- preparing detailed reports on the findings with suggestions regarding the final decision.
- Assisting the Manager, before the credit’s approval or rejection, by ensuring the client meets the requirements to obtain a credit:
- Collecting information and processing each file to the closing stage;
- contacting other financial institutions to verify the financial background of credit applicants;
- examining applicants’ assets and finances;
- analyzing the applicants’ capability to repay credit lines by conducting a thorough assessment on creditworthiness; and
- submitting a detailed report regarding any abnormality on the processed file.
- Maintaining detailed records on the applicants’ backgrounds:
- Keeping an accurate and up-to-date list of the annual reviews required pursuant to loan and credit regulations;
- compiling, copying, sorting, and filing records of the applications in progress and the ones already approved; and
- preparing monthly and quarterly credit reports.
- Filling forms on credits and loans and passing them along to the corresponding department.
- Ensuring compliance with all internal control and established policies related to credit products, in order to guarantee transparency in every application processed.
The average Credit Analyst salary in USA is $49,695 per year or $25 per hour. This is around 1.7 times more than the Median wage of the country. Entry level positions start at $35,000 while most experienced workers make up to $70,000. These results are based on 761 salaries extracted from job descriptions.
- Interpersonal and communication skills:
- Communicating clearly, both in writing and verbally, in order to effectively advise and interact with clients; and
- establishing and maintaining supportive working relationships.
- Organizational and time management skills:
- Prioritizing and planning work activities in order to manage time efficiently while handling a high volume of work; and
- multitasking; being able to work in a dynamic, fast-paced environment.
- Analytical, problem-solving, and decision-making skills:
- Effectively analyzing numerical data, drawing logical inferences, and providing reasonable recommendations;
- identifying issues and resolving problems in a timely manner; and
- being able to exercise strategical thinking and mature judgment.
- Strong attention to detail:
- Efficiently and accurately reviewing and entering accounting and financial information into a database;
- identifying, evaluating, and reporting any misleading or irregular information; and
- staying focused during highly repetitive tasks.
- Administrative skills:
- Demonstrated computer proficiency in Microsoft Office suite and spreadsheet software, including the ability to develop and use formulas; and
- experience in creating graphics, flow charts, and projections in order to generate statistics.
- Goal-oriented, reliable, flexible, and confident:
- Being self-motivated, highly driven, and having an entrepreneurial personality; and
- being able to work independently.
- High levels of honesty, discretion, and integrity:
- Being trustworthy enough to handle sensitive/confidential information.
Credit Analysts are responsible for assessing clients’ financial records thoroughly, in order to offer the most suitable credit option that meets their financial goals and needs; hence, they are required to have a vast knowledge of financial and bank credit lines, as well as to be familiar with current credit regulations and lending best practices. In this regard, having knowledge on mortgages, escrows, and titles are an asset.
Aside from the aforementioned skills, Credit Analysts are required to have an excellent knowledge of financial accounting, as well as a vast understanding of credit and financial analysis, and to have completed a bachelor’s degree in Finance, Business, Accounting, or any other field-related degree.
Similarly, in order to demonstrate and support their skills, candidates have the possibility of getting field-related certifications. The most sought-after certifications include, but are not limited to, the following:
- Chartered Financial Analyst (CFA), conferred by the CFA Institute;
- Credit Business Associate (CBA), granted by the National Association of Credit Management (NACM); and
- The Credit Business Fellow (CBF), promoted by the NACM.
Most Credit Analysts require a minimum of 2 to 4 years of experience working in the Finance or Accounting field and must also have acquired relevant experience in a client-facing, accounting role. Having a basic knowledge of the sector in which the applicant wants to work is always a must.