EconPapers    
Economics at your fingertips  
 

CONTINGENCIES FOR MEASUREMENT OF THE CREDIT RISK

Marinela Barbulescu (), Alina Hagiu and Cristina Baldan ()
Additional contact information
Marinela Barbulescu: University of Pitesti, Faculty of Economics, Romania
Cristina Baldan: University of Pitesti, Faculty of Economics, Romania

Scientific Bulletin - Economic Sciences, 2015, vol. 14, issue 3, 60-65

Abstract: The Global Financial Crisis, which affected various banks, some of them very important banks, highlighted the importance of an accurate credit risk measurement in order to be able to overcome it. There are a variety of such credit risk measurement models, so we can say that banks face a real dilemma when having to choose the most appropriate one. The aim of this paper is to examine the most popular methods used to measure the credit risk and to identify the strengths and the weaknesses of each one of it. The research was accomplished from a double perspective, in which the conceptual methodological approach is correlated to a variety of references to practical actions aiming the measurement and the prevention of credit risk. The study includes the presentation of the objectives of credit risk analysis, the most appropriate moments for doing such an analysis, the steps that have to be done in order to measure the credit risk, the errors that can overcome in the credit risk measurement system, generated by the misclassifications of the studied company, and the presentation of the specific information of financial creditors. The findings expressed in this paper were mainly the result of a qualitative analysis which showed that there is no best model for credit risk measurement, each one having both strengths and weaknesses, some providing a comprehensive analysis of the individual customer’s financial strength others allowing banks permanently monitor fluctuating default risk and identify the possibly problems at an early stage.

Keywords: Credit Risk; Global Financial Crisis; Risk Analysis; Bankruptcy; Measurement of a credit risk. (search for similar items in EconPapers)
JEL-codes: G32 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed

Downloads: (external link)
http://economic.upit.ro/repec/pdf/2015_3_7.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pts:journl:y:2015:i:3:p:60-65

Access Statistics for this article

Scientific Bulletin - Economic Sciences is currently edited by Logica Banica

More articles in Scientific Bulletin - Economic Sciences from University of Pitesti Contact information at EDIRC.
Series data maintained by Logica Banica ().

 
Page updated 2017-09-29
Handle: RePEc:pts:journl:y:2015:i:3:p:60-65