A credit analyst career can be confusing to some, so this article aims to explain exactly what goes on in a credit analyst career. At its most basic level, a credit analyst evaluates a loan applicant on a variety of criteria that establish an applicant's credit worthiness. Although this analysis is based on a number of numerical factors, it is not a science. Even an applicant who meets all of the criteria perfectly may still not actually be a low-risk candidate for credit.
EducationTo get started in a credit analyst career, you generally must complete a four-year bachelor's degree program in accounting or finance in order to adequately understand the concepts present in this field. It also helps to be adept at math, as you will work with statistics, ratio analysis, and even need to perform calculus functions. Even though computers handle the "number crunching" today, you still need to understand the interaction between various functions and understand what different results mean.
Beyond the four-year degree, some companies will require a CFA designation (Chartered Financial Analyst). A CFA designation proves that you have completed three levels of exams which cover topics such as economics, accounting, ethics, money management, and security analysis.
Where Does Someone in A Credit Analyst Career Usually Work?Those in a credit analyst career will often work at commercial banks, investment banks, credit card companies, credit rating agencies, and other investment companies. Essentially, any company that deals with investing in or issuing debt (i.e. loans) usually needs to employ at least one credit analyst.
What Are The Daily Tasks of Someone in A Credit Analyst Career?An individual in a credit analyst career will usually be responsible for the following daily tasks:
- Gathering, organizing, and analyzing financial information about clients
- Evaluating this data in order to recommend a course of action (i.e. whether or not to issue a loan, how much of a loan the client should receive, etc.)
- Evaluating current clients who seek an increased amount of credit
- Researching current news and trends in the finance industry
- Learning and using financial software such as Microsoft Excel and other analysis software
How Much Can Someone in A Credit Analyst Career Expect to Earn?Someone in a credit analyst career can expect to earn, on average, $50,000 to $55,000 per year during the first few years. As the individual becomes more experienced and specialized, salaries can increase to around $75,000 to $85,000 per year.
What Are the Negative Aspects to Being in a Credit Analyst Career?Although the job is challenging and intellectually stimulating, it often lacks appeal to those who do not have a strong interest in working with numerical information. Without a strong interest, many eventually find a credit analyst career to be boring or unrewarding.
Despite the fact that the average salaries are relatively high for someone with a four-year business degree, the job can often be stressful and require long hours during times when business is going well and many people or businesses are seeking credit. Often, this is dependent upon the health of the economy.