Credit Appraisal

Only available on StudyMode
  • Topic: Risk management, Basel II, Operational risk
  • Pages : 133 (41280 words )
  • Download(s) : 98
  • Published : July 25, 2010
Open Document
Text Preview
≈√

Guidelines on Credit Risk Management
C r e d i t A p p r ova l P r o c e s s and Credit Risk Management

These guidelines were prepared by the Oesterreichische Nationalbank (OeNB) in cooperation with the Financial Market Authority (FMA)

Published by:
Oesterreichische Nationalbank (OeNB) Otto Wagner Platz 3, 1090 Vienna, Austria Austrian Financial Market Authority (FMA) Praterstrasse 23, 1020 Vienna, Austria

Produced by:
Oesterreichische Nationalbank

Editor in chief:
Gunther Thonabauer, Secretariat of the Governing Board and Public Relations (OeNB) ‹ Barbara Nosslinger, Staff Department for Executive Board Affairs and Public Relations (FMA) ‹

Editorial processing:
Gabriela de Raaij, Heidi Koller, Markus Lietz, Wolfgang Spacil, Doris Wanka (all OeNB) Ursula Hauser-Rethaller, Karin Zartl (all FMA)

Design:
Peter Buchegger, Secretariat of the Governing Board and Public Relations (OeNB)

Typesetting, printing, and production:
OeNB Printing Office

Published and produced at:
Otto Wagner Platz 3, 1090 Vienna, Austria

Inquiries:
Oesterreichische Nationalbank Secretariat of the Governing Board and Public Relations Otto Wagner Platz 3, 1090 Vienna, Austria Postal address: PO Box 61, 1011 Vienna, Austria Phone: (+43-1) 40 420-6666 Fax: (+43-1) 404 20-6696

Orders:
Oesterreichische Nationalbank Documentation Management and Communication Systems Otto Wagner Platz 3, 1090 Vienna, Austria Postal address: PO Box 61, 1011 Vienna, Austria Phone: (+43-1) 404 20-2345 Fax: (+43-1) 404 20-2398

Internet:
http:/ /www.oenb.at http:/ /www.fma.gv.at

Paper:
Salzer Demeter, 100% woodpulp paper, bleached without chlorine, acid-free, without optical whiteners

DVR 0031577

Preface

The ongoing development of contemporary risk management methods and the increased use of innovative financial products such as securitization and credit derivatives have brought about substantial changes in the business environment faced by credit institutions today. Especially in the field of lending, these changes and innovations are now forcing banks to adapt their in-house software systems and the relevant business processes to meet these new requirements. The OeNB Guidelines on Credit Risk Management are intended to assist practitioners in redesigning a bankÕs systems and processes in the course of implementing the Basel II framework. Throughout 2004 and 2005, OeNB guidelines will appear on the subjects of securitization, rating and validation, credit approval processes and management, as well as credit risk mitigation techniques. The content of these guidelines is based on current international developments in the banking field and is meant to provide readers with best practices which banks would be well advised to implement regardless of the emergence of new regulatory capital requirements. The purpose of these publications is to develop mutual understanding between regulatory authorities and banks with regard to the upcoming changes in banking. In this context, the Oesterreichische Nationalbank (OeNB), AustriaÕs central bank, and the Austrian Financial Market Authority (FMA) see themselves as partners to AustriaÕs credit industry. It is our sincere hope that the OeNB Guidelines on Credit Risk Management provide interesting reading as well as a basis for efficient discussions of the current changes in Austrian banking.

Vienna, Dezember 2004

Univ. Doz. Mag. Dr. Josef Christl Member of the Governing Board of the Oesterreichische Nationalbank

Dr. Kurt Pribil, Dr. Heinrich Traumuller ‹ FMA Executive Board

Guidelines on Credit Risk Management

3

Table of Contents

1 2 2.1 2.2

Introduction Credit Approval Process Introduction Segmentation of Credit Approval Processes

2.2.1 2.2.2 2.2.3 2.2.4 2.2.5 2.2.6
2.3

Basic Situation Accounting for Risk Aspects Approaches to the Segmentation of Credit Approval Processes Object of Review and Exposure Management Overview of the Credit Approval Process...
tracking img