Analyzing the Risks of Bank Activities

1235 Words5 Pages
European bankers believe that any activity the bank has certain risks, dealing with credit risk with customers in the operation of the market price risk and exchange rate risk, even if dealing with different customers, different funding deal, only the House work, or are there operational risk, the employer of moral hazard, the bank can do is to manage risk, how to identify risks, how to identify risks,to determine the size of the risk and spread risk, and to prevent risks to provide appropriate protection. Statistically, the risk and reward is a positive relationship between the rate of return is higher, the higher the risk, the lower the rate of return, the risk will be relatively small, European bankers believe that banking activities must bear some risk , but also to be rewarded accordingly, risk control risk control department is definitely not a thing, every position, every person doing business must take into account when the risk factor in many of the European banks' business philosophy, risk and profit can not be separated, any reasonable person must take into account in their work, in fact, in the European commercial banks, marketing and risk control is not prominent contradictions, risk awareness controlled at every position, each person's subconscious. There are four principles of the act, first, four eyes while resisting a business, any business must have a double credit investigation, double approval, double underwriting, emphasizing the double joint audit of a business to ensure that risk index. In Europe, the bank's risk control system, a dedicated staff responsible for credit rating agencies and the work of the European Bank for any customer to be rated, and only after the finish rating can make whether to grant c... ... middle of paper ... ...s should jointly draw lessons from past mistakes When a loan becomes a problem loans (NPL) and the real losses occur , the bank 's audit department should first check whether the loan approval process compliance procedures, if there is procedural , procedural errors , then what links which an error on the responsibility . If everything is normal procedure , the procedure is complete, you do not need any personal responsibility. However, even without any personal liability sum loan , when the loss occurred, the risk control department and marketing departments must make the appropriate review of the lessons to be learned enough to come up in the future to avoid similar losses occurring approach to , and this case should inform the bank , so that we can alert. This is the " sharing of resources, sharing of experiences , lessons learned should be shared " principle . b
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