Expressbank pays special attention to the work done in the direction of risk management. According to the most advanced international practices and regulatory acts of the regulatory body, the risks are divided into the following types:
Credit risks
The risk of default by payers or borrowers of their obligations to the bank.
Expressbank credit risk is managed according to the Bank’s risk strategy and risk policy. The main purpose of credit risk management is to maximize the revenue given the risk of the loan portfolio. The Bank’s credit risk management system is based on the banking experience and requirements of the regulatory body.
Credit risk management mainly consists of three stages:
- Underwriting loans - an individual assessment of the credit risk in issuing a loan.
- Credit portfolio management - assessment of credit risk in the form of a portfolio.
- Credit monitoring - mounting loans based on some criteria after receiving the results of the first two stages.
Liquidity risk
The risk that the Bank is unable to fulfill its planned and unexpected obligations on time.
Efficient liquidity risk management and selection of the most useful methods for timely fulfillment of obligations, and preparation of all necessary plans for unexpected situations is one of the Bank’s priority goals. For this reason, the Bank applies certain liquidity limits and these limits are monitored daily. Regarding the liquidity risk within the Bank, stress tests and sensitivity analyzes are carried out regularly, an action plan is drawn up, and the results are communicated to the Directory
Operational risk
The risk arising from inadequate internal processes, human, (consciously or accidentally) systemic and external errors. Legal, image and other non-financial risks are also classified as operational risks.
Market risk
The risk arising from adverse changes in exchange rates, interest rates, and commodity prices.
Strategic risk
The probability of loss that may occur due to unsuccessful and bad business plans.
Image risk.
This is a risk arising from a decrease in confidence in the bank and the formation of negative reviews about the bank.
To prevent the occurrence of risks, and reduce them to a minimum, the Risk Management Department carries out the following measures:
- Identify, evaluate, and analyze emerging operational risks.
- Minimization of operational risks, using standard procedures and maximum automation of banking processes.
- Analysis of business processes and their optimization.
- Implementation of the process of self-assessment of risks and risk control in all aspects of banking processes.
- Implement restrictions (monitor their implementation), conduct monitoring.
- Monitoring compliance with regulatory requirements.
- Development of the bank security system.
- Control over the creation of probable losses.
- Vintage analysis
- Loan portfolio analysis.
- Cumulative analysis
- Stesse - test
- Create a risk map.
Expressbank has developed a risk management strategy and risk policy, as well as a risk map for risk management. On the basis of the above documents, internal rules and procedures were developed, an analytical system was developed based on stress scenarios, and an emergency plan was prepared.
All structural divisions of the Bank carry out systematic measures to improve internal rules, procedures, operations and processes related to risk.
(Updated on 17.05.2019)