Portfolio credit risk is the aggregate risk arising from a collection of credit exposures, driven by macroeconomic conditions, borrower-specific factors, exposure concentrations, and inter-linkages across obligors and sectors. This article…

Credit rating has become an indispensable tool in modern finance, especially for banks that continuously assess risks in lending. It not only ensures that banks minimize their exposure to defaults…

A robust credit assessment distinguishes between obligor/borrower risk, business (operating) risk, and financial risk, then evaluates how these risks interact across industry, entity, and portfolio levels. This integrated view helps…

Credit Risk Management (CRM) is the backbone of sound banking practices. It ensures that banks strike a balance between growth-oriented lending and prudent risk control. An effective framework combines strategy,…

Credit risk management is essential to protect capital, sustain earnings, and enable prudent growth across credit cycles, making it a foundational pillar of safe and sound banking practice. Need for…

Credit risk is at the heart of banking and finance. Every loan or investment carries the possibility that the borrower may fail to meet repayment obligations, creating a serious challenge…

Subtitle: A practitioner’s guide to liquidity, solvency, measurement, stress testing, and governance IntroductionLiquidity is the ability of a bank to fund asset growth and meet obligations as they fall due…

India’s banking system is in the midst of a decisive shift driven by digital public infrastructure, AI-enabled operations, regulatory tightening, and a renewed focus on resilience and inclusion. The go-forward…

Duration GAP Analysis, stress testing, and backtesting are foundational tools in a bank’s Asset-Liability Management (ALM) toolkit to manage interest rate risk and protect both earnings and economic value of…