There are two approaches to measure credit risk: one is use of credit ratings (external and /or internal) - Banks should have a comprehensive risk scoring / rating system that serves as a single point indicator of diverse risk factors of a counterparty and for taking credit decisions in a consistent manner. Another method is estimating the loan loss i.e. expected loss (t he average loss that the organization expects from exposure over a fixed time period, usually a year) using 3 integral components (known as risk components) that are required to be estimated for credit risk quantification. o Probability of Default (PD): It refers to the probability/risk/chance of a borrower defaulting on the payment of the credit obligations, within a given time horizon, usually one year. o Loss Given Default (LGD): It refers to the loss likely to be suffered in the event of a default occurring in an exposure. It takes into account the number of recoveries likely to be made post default o Exposure at Default (EAD): It refers to the amount that is exposed to the default risk. It is usually the amount outstanding as well as undrawn commitment that is expected to be drawn by the time of default.
With reference to the lightweight payments, consider the following statements:
1. The lightweight payments are dependent on the existing system o...
What is the target capacity for hydroelectric projects by 2031-32, as per the revised scheme?
NPCI sets_____ as a deadline to activate offline payments on RuPay cards.
Where will the first-ever Street 20 World Cup cricket tournament for street children be held?
IIT Madras and National Institute of Ocean Technology (NIOT), Chennai, are organizing the OCEANS 2022 Conference and Exposition, the bi-annual event fo...
What is the theme of the 81st plenary meeting of the International Cotton Advisory Committee (ICAC)?
Veteran sports administrator _________ was unanimously elected as president of the Indian Weightlifting Federation (IWF) for a four-year term.
Consider the following statements:
I. National Ayush Mission (NAM) is a central sector scheme implemented by...
For the first time India’s equity market is ranked at ________ in the world in terms of market capitalisation.
During the 2024 International Meet in Chennai, which Indian medical professional was bestowed with the ‘Lifetime Achievement Award’?