In the dynamic world of lending, the ability to effectively manage credit risk is paramount. It’s the art and science of assessing a borrower's likelihood to repay and mitigating the potential for financial loss due to default. For Australian lenders, this is not just a business imperative but also a significant regulatory requirement, influencing capital adequacy, profitability, and public trust. This lesson will provide a comprehensive understanding of credit risk management, from foundational concepts to advanced techniques and the specific Australian regulatory environment.
