Moody's KMV Concludes Inaugural Credit Practitioner Conference; Credit Risk Experts Come Together from Around the World to Share Research and Best Practices.

SAN FRANCISCO -- Moody's KMV today announced that it successfully concluded its first Credit Practitioner Conference. The well attended event in Key Biscayne, Florida, brought together industry leaders to discuss the evolution of quantitative credit risk management - transforming leading edge research into best practice. More than 150 international guests from banks, insurers, corporations and investment management companies attended the three day conference.

Conference participants from across industry segments had an opportunity to discover more about how banks, corporations and buy-side/sell-side firms manage credit risk. Attendees participated in sessions that gave them a first hand look at Moody's KMV's state-of-the-art solutions.

Andrew Huddart, President of Moody's KMV, addressed conference attendees at the launch of the inaugural event and noted that, while EDF measures had recently been low, those organizations with robust risk measurement infrastructure would be best placed to manage through the next cycle. He went on to say that "Moody's KMV intends to continue investing to maintain its position as a thought leader and 'The Standard' of credit risk management research and related solutions worldwide."

In addition to plenary sessions where "big picture" issues in credit risk were discussed, concurrent stream sessions were held addressing specific credit measures, tools, trends and regulations. Discussions were led by industry leaders from across the credit risk management arena including Moody's KMV.

During the opening keynote address, Stephen Kealhofer, Co-Founder of KMV and Managing Partner, Diversified Credit Instruments, talked about generating returns on the credit portfolio. "If you construct your credit portfolio carefully, you can get a return for the risk that is more than commensurate with other investment alternatives," he said. "It is particularly appealing when you consider that in fixed income there are few legitimate ways to generate good returns - either you guess the direction of interest rates or you speculate on the value of prepayment options in home mortgages."

Other highlights included:

Som-Lok Leung, Executive Director of the International Association of Credit Portfolio Managers (IACPM), delivered a dinner keynote address that highlighted the importance of actively managing a credit portfolio. He stressed that managers of credit portfolios must be equipped with appropriate tools to value their loan portfolios and warned that while critical, the vast majority of lenders do not utilize such tools.

Dr. Jeffrey Bohn, Managing Director of Research for Moody's KMV, gave credit practitioners an in-depth look at how Moody's KMV uses market data to value credit instruments. He said, "Moody's KMV's research group is focused on incorporating information from more than just equity markets. We now provide empirical insight from corporate bonds, credit default swap data and secondary loan markets. This expanded research agenda facilitates modeling more asset classes as Moody's KMV rolls out its next generation portfolio analytics, designed to better support active credit portfolio management."

Veronique Ormezzano, Head of Capital & Loan Portfolio Management, BNP PARIBAS, and a member of the board of IACPM, led a discussion on the paradox of hedging credit portfolio risk. She said that hedging reduces risk in terms of economics, but because of new accounting rules it also creates volatility on the bank's earnings.

Moody's KMV's Kevin O'Connor, together with a panel of corporate executives, led sessions on corporate credit risk. Through detailed examples, audience members learned how corporations are beginning to assess credit risk at the portfolio level as well as the counterparty level. Speakers stressed that corporate credit managers must improve and build their knowledge of portfolio risk concepts and illustrated that adoption of quantitative credit risk measures leads to a consistency in process management that can help with issues of regulatory compliance.

Moody's KMV, a wholly owned subsidiary of Moody's Corporation, is the world's leading provider of quantitative credit risk solutions to lenders, investors and corporations. Moody's KMV's tools and services provide current default probabilities, recovery estimates, valuations and correlations, and are widely used to assess portfolio risk/return. Moody's KMV serves over 2,000 clients in 80 countries, including most of the world's 100 largest financial institutions. The company maintains the largest database of corporate defaults in the world. In addition to its San Francisco headquarters, Moody's KMV has offices around the globe to serve its international customer base. Further information is available at www.moodyskmv.com.