How Blue Chip are your Blue Chips?
Clearly the definition of what compromises a Blue Chip Company depends on an individual perception of credit risk and any gathering of credit risk analysts will produce as varied a response as the proverbial gathering of economists.
The events of the 4th Feb 1971 have passed into insolvency folklore, when Rolls Royce Ltd announced the appointment of Receivers to their staff over the tannoy system. Arguably this was a high profile manifestation of the decline in British motor manufacturing industry with MG Rover being a more recent example.
Most people’s definition of a blue chip company is one that they could never imagine would fail and one they would never consider credit insuring.
At a time when World economies in general are reacting to an excess of credit and sectors like our retail business are facing the challenge of ever changing business models, just what is foreseeable?
Who could have foreseen the banking liquidity crisis? Will your Blue Chip customer warrant Government intervention to save your receivable?
Enron, Swiss Air, MG Rover, Barings, Parmalat, Rolls Royce, XL, Alders, Tiny Computers, Arthur Anderson, Lehman Bros………………………………………… |
