Assessment and Management of Credit Risk in Banks: Examining Small and Medium Businesses

This paper discusses methods for assessing and managing credit risk in banks using the example of small and medium-sized enterprises. In developed countries, small business holds a large share in their GDP. They are a guarantee of free market competition. For a company, bank lending is necessary for development, when for banks the allocation of funds is the main source of interest income. Lending to small businesses is one of the most profitable ways to place funds. Therefore, minimizing credit risks in financing small businesses is one of the priority areas of activity of any bank. The aim of the diploma is to study the basic methods for assessing and minimizing credit risk in lending to small and medium-sized enterprises. To do this, we studied the basic theoretical and practical materials to minimize the credit risk of small and medium-sized businesses.