Credit risk is most simply defined as the potential that a bank borrower or counterparty will fail to meet its obligations in accordance with agreed terms. Sound practices and tools for Credit Risk Management are essential to the long-term success of banking organizations and financial services providers.
A Credit Risk Management Platform enables the analysis of credit risk, the automation of lending and decision-making processes as well as continuous risk monitoring. Improve compliance and lower risk with scorecards and risk models operationalized in automated risk decisioning processes. This allows to immediately respond to new opportunities, competitive challenges, or regulatory changes.
The ACTICO Credit Risk Management Platform helps your organization overcome these challenges. The system provides a highly flexible, enterprise-level credit risk management framework that automates counterparty risk assessment and credit origination processes in banks, financial service providers and corporations, including but not limited to:
Banks and other financial service institutions around the world are looking for ways to improve operational efficiency, control risk and achieve a long-term competitive advantage while maintaining compliance with an ever-increasing set of regulatory requirements. Many of the initiatives banks and financial service institutions use for Credit Risk Management are associated with the following key drivers:
Banks use Internal Ratings-based credit risk models (PD, LGD, EAD) to comply with the Basel requirements for calculation of risk weighted assets and minimum regulatory capital requirements.
When originating loans, commercial lenders and financial service providers need to assess credit risks accurately to make more precise and better informed lending decisions.
Following recent amendments to financial accounting standards (e.g. IFRS9/ US-GAAP), organizations will need to generate forward-looking and lifetime credit loss forecasts for credit impairment by implementing and applying Lifetime Expected Loss Models (ECL) under IFRS9 or the US-GAAP equivalent Current Expected Credit Loss Models (CECL).