From the course: Corporate Financial Statement Analysis

Unlock this course with a free trial

Join today to access over 25,200 courses taught by industry experts.

Use AI to assess financial risk from leverage

Use AI to assess financial risk from leverage

From the course: Corporate Financial Statement Analysis

Start my 1-month free trial Buy for my team

Use AI to assess financial risk from leverage

“

How are banks using artificial intelligence to help with the financial statement analysis of current loan customers and also potential borrowers? Well, banks have long used company financial statements as a key source of information in evaluating a potential borrower's ability to repay a loan. Artificial intelligence is automating and standardizing this financial statement analysis process, accelerating the speed of a bank's analysis and taking care of routine tasks so that human loan analysts can focus attention on the cases that require human judgment. Okay, but can you use artificial intelligence to interpret the meaning of different companies' debt ratios? Yep, turns out you can. Here's an example. I typed the following request into ChatGPT. Define a company's debt ratio as total liabilities divided by total assets. Using the most current financial statements, compute the debt ratios for Alphabet and Walmart. Interpret these numbers and explain why one of the debt ratios is much…

Contents