Subject The financial crisis as an external destabilizing factor has had a significant impact on the deterioration of creditworthiness of economic entities, which entailed a growth of doubtful and overdue debt on long-term loans. This fact necessitates the research and enhancement of approaches to borrower's creditworthiness assessment being one of important tools of management and regulation of banking long-term lending. Objectives Despite the multi-year practice of applying the creditworthiness assessment technique based on indicators of financial condition of an entity (i.e. liquidity, financial stability, turnover, and profitability), it is expedient to develop new approaches to customer's creditworthiness assessment with possible consideration of various external and internal factors. Methods I offer to complement the assessment of borrower's creditworthiness with the analysis of indicators that take into account the specifics of long-term banking resources. Based on the forecasting methods and autoregression dependencies, I propose a new approach to borrower's creditworthiness assessment with consideration for the time factor, which enables to perform a forecast of borrower's creditworthiness for the entire period of long-term lending. Results It is possible to use the technique in banking practice, to perform an additional analysis of borrower's creditworthiness, to assess the financial position stability over the entire period of long-term lending. The application of additional indicators of borrower's creditworthiness assessment, which involve long-term borrowed funds of economic entities, will help banks consider specific features of long-term lending and strengthen the banking information and analytical base. Conclusions and Relevance Using the approach to borrower's creditworthiness assessment with possible forecasting of the borrower's financial condition for the entire period of long-term lending will enable banks to regulate the level of customer's credit risk, to determine possible limits of change in credit reserves, and to have a more complete picture of parameters of the borrower for the entire period of lending at the date of loan issue.
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