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7.1 Scope

7.1.1
 
The concept of Net Present Value (“NPV”) is commonly used to estimate various metrics for the purpose of financial accounting, risk management and business decisions. This section focuses on standalone NPV models employed for the purpose of general asset valuation, covering, amongst others, investment valuation, collateral valuation and financial modelling to estimate the cost of facility rescheduling (or restructuring). The discounting component embedded in ECL, LGD and CVA models is discussed in other sections.