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Financial Risk Manager Part 2

Financial Risk Manager Part 2

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In the realm of assessing migration risk, a risk analyst from a rating agency is tasked with evaluating the actual defaults for a specific rating category of corporate issuers. Initially, at the end of 2016, this rating category encompassed 348 issuers. The table below indicates the number of issuers who did not default over a span of three years:

YearNon-Defaulted Names at Year-End
2016348
2017339
2018333
2019329

Assuming that no new issuers were added to the rating category during the observation period, calculate the 1-year incremental probability of default for the year 2019.

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