Credit Risk Management for Banking

Credit risk, being the oldest form of financial risk, has persisted since ancient times, and despite its historical presence, effective management remains an ongoing challenge, evident in frequent high-profile losses reported in the media. This course is designed to furnish participants with a comprehensive understanding of credit risk and the methodologies for its effective management.

Credit risk management is a critical function in the banking sector that involves identifying, assessing, and mitigating the risks associated with lending activities to ensure the financial stability and profitability of financial institutions. The "Credit Risk Management in Banking" course is designed to provide professionals with a comprehensive understanding of credit risk management principles and techniques specific to the banking industry. Geared towards credit risk managers, bankers, financial analysts, and regulatory professionals, this course offers essential knowledge and practical skills to effectively manage credit risk within banking institutions.

Objective

• Understand the fundamental concepts of credit risk, its sources, and its impact on banking performance and stability.
• Learn how to assess borrower creditworthiness using quantitative and qualitative analysis, including financial ratios, cash flow evaluation, and industry risk assessment.
• Develop the ability to identify, measure, and monitor credit risk across various banking products such as loans, trade finance, and corporate lending.
• Gain proficiency in credit risk rating systems, scoring models, and risk classification methodologies used in modern banking.
• Apply risk mitigation techniques, including collateral evaluation, guarantees, covenants, and credit insurance.
• Understand regulatory expectations, including Basel III/IV requirements, capital adequacy, risk-weighted assets (RWA), and provisioning standards.