Summit Releases White Paper on Concentration Risk and Federal Lending Programs

Posted by Eva Palmer on 3/14/17 8:36 AM

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Today, Summit Principal Anthony Curcio published a white paper on concentration risk and federal lending programs. Titled “Should Federal Lending Programs Mitigate Concentration Risk?” the paper dives into what concentration risk is, how it is mitigated in the private sector, and how it relates to federal lending programs.

“Often, Federal loan programs are created by the Congress to accept or even seek out concentration risk to achieve a policy purpose. In some cases, therefore, efforts to diversify these programs may be at odds with Congressional intent,” Curcio says.

Federal credit risk guidelines do not address concentration risk. Because of this, Curcio explores how federal loan programs should think differently about concentration risk than the private sector in his newest white paper.

“Most see the Federal government as a single balance sheet. That affects the way we understand concentration risk within Federal lending and the way we measure and mitigate it,” Curcio says.

Curcio released the white paper with special thanks to Darryl E. Getter, Ph.D., a Specialist in Financial Economics at the Congressional Research Service of the Library of Congress. 

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Topics: federal credit, white paper

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Summit is a specialized analytics advisory firm that guides clients as they decode their most complex analytical challenges. Our blog highlights the strategies and techniques we use, as well as relevant topics in current events.

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