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10 Risks in Banking Industry Faced by Every Bank

The financial service industry has gone through a significant transformation over the last few decades. The rapid transformation and changing regulatory environments has resulted in a highly complex ecosystem. Stakeholders from different backgrounds who play influential roles in the banking industry bring new complexities. As a result, banking institutions need to adjust risk management procedures to accommodate risks that come with new players. Monitoring and managing these risks guarantee a safe transformation in banking.

1. Credit Risk

Credit risk is a common banking risk that can be expressed in two ways:

  • The uncertainty involved in the repayment of banks dues.

  • Failure by borrowers to meet payment obligation regarding terms agreed upon with the bank.

Banks suffer heavy losses from ...

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