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Enron Mail |
We had very successful media briefings in the US last week for Enron Credit.
Overall, the meetings and site demos were a huge success and all of the reporters seemed to genuinely benefit from the site demo of Enron Credit. Below is a quick recap of John Sherriff's and Jeff Kinneman's media briefing schedules, as well as some additional notes and an article resulting from one of the demos. John Sherriff held briefings with reporters from the following publications: DerivativesWeek Dow Jones Fortune Magazine Bondweek Investor's Business Daily Financial Times BusinessWeek Jeff Kinneman held briefings with reporters from the following publications: Risk Magazine Institutional Investor Wall Street & Technology Derivatives Strategy Pensions & Investments Power Finance & Risk We are already beginning to see results based on the demos. As you know, Dow Jones wrote a story on Enron Credit following the site demo; the article appeared on April 4, 2001. It is pasted below for your review. CFO.com also ran a story on Enron Credit last week. In the next few weeks we expect to see stories in Bondweek, BusinessWeek, DerivativesWeek and Derivatives Strategy. I will keep you posted on the European Briefings as well. Thanks- Meredith Enron Turns Internal Credit-Risk Tool Into New Product By Christina Cheddar 08:15 ET Dow Jones News Service (Copyright © 2001, Dow Jones & Company, Inc.) Of DOW JONES NEWSWIRES (This report was originally published late Wednesday.) NEW YORK (Dow Jones)--With the number of corporate bankruptcies on the rise, knowing the creditworthiness of one's customers is becoming more and more important. For Enron Corp. (ENE), the world's largest energy trading company, keeping track of credit risk has always been part of doing business. That became even more true with the company's launch of EnronOnline, its Internet-based commodities trading network. In order to deal with the accelerated volume and speed of transactions on EnronOnline, the company developed a tool to help its own commercial traders manage the credit risk. Early last year, Enron rolled out this tool, Enron Credit, on a limited basis. Gradually, the company expanded its use and scope. Last month, the company re-launched Enron Credit in its current format. Enron Credit tracks more than 10,000 companies, giving each a rating known as the "Enron cost of credit ." The rating is expressed as an interest rate. The Web site also provides news, a company's expected chance of bankruptcy and other related information. While much of this information is free to registered users, Enron also has turned the product into a new revenue stream. Users may download data into a spreadsheet and receive periodic updates for a fee. The site also can sell a user a "digital bankruptcy swap," which is a way to hedge against credit exposure. The price of the swap is determined by a rating Enron's staff assigns to a company and the amount of credit exposure a company needs to protect against. For a supplier, the main advantage of a swap is that if a customer is unable to pay due to bankruptcy, the supplier will be paid immediately. According to Enron Europe President John Sherriff, the goal of Enron Credit is to create a more efficient credit market by increasing trading liquidity. The tool is important because "in just a short amount of time, a company's credit can go from stellar to bad literally overnight." At present, some analysts haven't factored in revenue from Enron Credit into their earnings models. However, as the commodity markets Enron trades in mature, it is possible the need for products such as Enron Credit could increase. -By Christina Cheddar, Dow Jones Newswires; 201-938-5166; christina.cheddar@dowjones.com
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