Tag Archive for credit risk

Risk Assessment

Written by: Arijit Bhowmick Complete Credit Risk Assessment can be performed by precise loan pricing, more accurate loss forecasting, better evaluation of investment and disinvestment options, optimal portfolio management. Inaccurate loan-loss provisioning causes a level of “lazy capital” i.e. capital not…

Can Risk Management be a “Risky” Task?

By Ayse B. Nordal   Background Private and public companies, financial institutions, individuals and even states are living in a risky world. This makes risk management an important and responsible function in every organization. Is risk management also a “risky”…

Credit Risk Management

The active management of credit risk has been receiving increasing regulator attention and strategic focus at many financial institutions. Regulators cite poor credit risk management at the portfolio level, weak credit standards for borrowers and counterparties, and insufficient attention to…

Credit Risk Assessment

For many banks, credit risk is a key risk and makes up the largest amount of risk-based capital for the Basel capital allocation. Credit risk arises when dealing with customers, vendors, and other counterparties. It is generally viewed as the…

Expected Loss (EL) Calculation

Lending institutions need to understand the loss that can be incurred as a result of lending to a company that may default; this is known as expected loss (EL).  EL can be expressed as a simple formula: EL = PD…