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Home > Research and Studies > Bank of Japan Working Paper Series, Review Series, and Research Laboratory Series > Economic Commentary > Will Japanese Companies Achieve a Full-Fledged Recovery?-- Evaluating the financial improvement of the companies using the estimated equation for forecasting credit ratings --
-- Evaluating the financial improvement of the companies using the estimated equation for forecasting credit ratings --
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The creditworthiness of companies, and also their profitability and financial condition, are one way to measure whether the improvement in the risk-taking behavior of companies, such as business fixed investment, is becoming full-scale. In this paper, we use "credit ratings," a major indicator showing the creditworthiness of companies, to verify whether the profitability and the state of balance sheets of companies have reached the stage where they are consistent with positive improvement of credit ratings.