The authors conducted a study related to the internal credit risk assessment models. The study is based on statistical approach (multi-correlation analysis, binomial regression analysis, logit /probit model). The study is based on 2864 Latvian small and medium sized enterprises financial statements in regard to the 2000 and 2007. In the process of logical and сorrelation analysis 34 financial indicators, were used in the insolvensy models of different researchers, such as E. Altman ( ), R. Taffera and G. Tishou, J. Conan, M. Golderona, D. Chesser, M. Zmievskaya, G. B. Savitsky and others, the authors selected three indicators. Developed model accuracy is 66 - 80% confidence interval with 95% probability and it exceeds its foreign researchers accuracy of forecasting models.