The financial crisis impact on credit risk management in commercial banks

Abstract

Credit risk has been and still remains the essential and core risk in commercial bank activities. The causes of recent financial crisis reveal not only systemic or structural imbalances, but the necessity to keep and strengthen the principles of credit risk management. Moreover, the lessons that should be learned indicate the weakness of the credit risk management systems and models used by commercial banks and forces to re-evaluate them. This article presents the analysis of the influence of recent global financial crisis on credit risk management in the commercial banks and provides summarized challenges faced by banks for credit risk management improvement.