An approach to measuring credit risk in a banking institution from Romania

Nora Chiriță and Ionuț Nica
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Nora Chiriță: Bucharest University of Economic Studies, Romania
Ionuț Nica: Bucharest University of Economic Studies, Romania

Theoretical and Applied Economics, 2020, vol. XXVII, issue 2(623), Summer, 65-78

Abstract: Studying the behavior of banking systems both at the macroeconomic level and with the external environment, as well as at the level of financial institutions associated with their dynamic character, in the current context is in the attention of all specialists. Risk quantification is an important aspect in making strategic decisions regarding maintaining financial stability and maintaining a high level of performance of any banking institution. The complexity of current financial systems around the world makes it difficult to create indicators that accurately assess the systemic risk of any institution. This paper has shown that an incorrect credit risk assessment can lead to a decrease in the performance of banking units and can generate a systemic shock that can affect both financial networks and the national or global economy.

Keywords: credit risk; banking; financial stability; expected credit loss. (search for similar items in EconPapers)
Date: 2020
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