Skill Levels in Risk Management: Trainiing in Credit Risk - A Comparitive Study of Indian Banks and Foreign Banks

Abstract

Risk management is a cornerstone of prudent Banking practice. Undoubtedly all Banks in the present-day volatile environment are facing a large number of risks such as credit risk, liquidity risk, foreign exchange risk, market risk and interest rate risk, among others - risks which may threaten a Bank's survival and success. Banking is a business of risk. For this reason, efficient Risk Management is absolutely required. With a view to strengthen the Risk Management in the Banks across the Globe, Basel Frameworks have made concerted efforts to address all the issues relating to Financial Risks like Credit, Market Risk and Operational Risk and some other non-Financial Risks as well. The impact of the non-Financial Risks is all pervasive and can be severe enough that they can lead to total collapse of the Banks. This research paper briefs about the training inputs of the Banking personnel in the Credit Risk in the select sample Banks. The main objective of this study is to identify and analyze the knowledge of the Banking personnel in the Credit Risk in select sample Banks. This study emphasizes the need for a robust training mechanism for the operating personnel so as to have a better understanding on the Credit Risk. The findings of the study show that the operating personnel in Foreign Banks are well trained on Credit Risk Management when compared to the operating personnel in Indian Public sector Banks and Private Sector Banks.