Risk rating methodology for trust companies

Abstract

Fiduciary companies or fund lenders are financial services entities subject to the inspection and surveillance of the Superintendence of Companies, Securities and Insurance, whose objective is the management of businesses, transactions or operations on behalf of third parties and by those who receive mandates from confidence to fulfill a specific purpose. In Ecuador, these types of companies have increased their operations and market share in the last decade; therefore, knowing the types of products they offer and the risk they represent is important in order to control them and not affect the resources entrusted to them. The present work addressed statistics generated in these societies, due to the amount of resources they manage and the growth that the sector has achieved over time; In turn, with a qualitative - quantitative approach to research - action, a rating methodology is proposed in order to help the users of these entities to mitigate the inherent risk that these companies represent. The methodology consists of three methods based on the CAMEL methodology and the hierarchical analytical process decision theory; where the results showed a rapid perception of atypical situations in the fiduciaries through the monitoring of alert indicators.