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A critical study of credit risk management in the First Bank of Nigeria PLC
Finance & Accounting
Pages 20 (5020 words)
Credit risk management contains some key principles that are:a clear structure should be established,accountability and responsibility should be allocated,prioritize the processes,clear communication of assigned responsibilities …
First one is reaction against bank losses from the Newton, it is realized that losses are unbearable after the losses have occurred. The second aspect is that that bank has been pushed by the recent progress in the area of financing securitization, commercial paper and competition with other non-banks to find possible loan borrowers. Big and stable companies have been seen to shift in the open market sources like those in bond markets of finance.The degree of risk of assumed losses can be minimized by organizing and managing the lending criteria with professionalism and also with active approach. Credit risk management issues can be measured if bank could tap progressively refined measuring technique.The adoption of more rigorous credit risk has been facilitated by the technological developments, predominantly the growing availability of low cost computing power and communication. A lot of banks still have a long way to go in the implementation of such new approaches.Competition in the provision of financial services is increasing probable due to the acceleration of change in credit risk management in the banks which is viewed as an unavoidable response to an environment and, thus need to classify new and gainful business prospects and appropriately measure the related risk is mounting for the banks and other financial institutions. ...
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