A credit risk analyst, more commonly referred to as a credit risk manager, reviews large quantities of financial data from banks or corporate firms to determine the risk involved in lending money or extending credit. To become a credit risk analyst, you will need detailed training and education in financial topics and some programming skills. Financial credit risk manager certification as well as a risk analyst certification may also be required.
To become a credit risk analyst, you first should look for a college or university program that offers majors in the following disciplines: finance, business, economics, operations, or statistics. This job is mainly quantitative-based, and you must master advanced level mathematical and statistical modeling skills by completing challenging coursework. Additionally, competence in accounting is imperative, as a credit risk manager is expected to manage complicated risk portfolios involving fixed income variables, such as over-the-counter (OTC) derivatives, futures, and options.
If you are interested in advancing in the credit risk analysis field and receiving a higher salary, you may want to consider pursuing a more advanced degree in financial management. Companies that hire high-level credit risk analysts typically require them to have an Master's of Business Administration (MBA) degree from a top school. Look for top MBA programs that are known for concentrating on financial analysis and operations engineering.
Programming skills centered on the ability to manipulate advanced-level Excel functions is also an important skill that anyone looking to become a credit risk analyst must develop. Excel is a software product used to analyze and visualize data. Credit risk management departments in banks large and small utilize Excel spreadsheets to organize the tens of thousands of pieces of their clients' risk information profiles into manageable and actionable data items.
Certification is an important part of the process to become a credit risk analyst. Oftentimes, when a credit analyst job posting states that salary is commiserate to experience, it means that a candidate who is certified in the field can and will command a higher salary then someone who is not. Many of these companies prefer that you have undergone the Certified Financial Analyst (CFA) exam and have passed it. Passing the CFA exam with high marks allows you to compete with other candidates who may have gone to a more prestigious undergraduate or graduate school or may have worked in a more well-known and established investment bank.