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Credit Risk Data Capture System

The risk a Bank or any financial institution faces from imminent decline or elimination of the value of assets (including off-balance sheet assets), is called Credit Risk. This risk emerges due to the deterioration in the financial condition of the entity to which/whom credit is provided. Hence, a system to capture the credit risk data is extremely important for any financial institution.

Credit Risk Data Capture System


The Challenge

Poor credit quality and poor assessment of credit risk are the causes behind the failure that befalls banks. Failure in on-time identification of deterioration in credit quality aggravates the problem and prolongs the solution process. The usefulness of capital requirements would be challenged and the proper assessment process would be hampered, if the credit risk assessment policies and procedures are inadequate. This would also lead to inadequate and untimely recognition and measurement of loan losses.

The BASEL Committee has come up with several concepts on credit risk modeling and credit risk management. The banking supervisors choose those concepts which they deem fit to be executed for credit risk assessment and valuation practices.

These are some of the challenges that necessitate Credit Risk Data Capture System for every financial institution:

  • Many Banks and Financial Institutions have incurred huge losses and some of them failed due to absence of effective credit risk management system
  • Regulators require that Financial Institutions implement a comprehensive framework for measurement and control of credit risk.
  • Basel Norms threaten to impose punitive capital charges for errors and wrong estimation of credit risk data
  • Need for aggregation of risk-related information to assess the PD, LGD, and EAD

Our Offer

Our Credit Risk Data Capture system works thus:

  • Data regarding Borrower, Credit Structure and External Ratings Data are collected.
  • For a new applicant the complete details are collected and entered.
  • For an existing borrower, the changes or additional information are incorporated.
  • These will be the main screens and based on selection, further details will be stored in sub screens.
    For example, in customer ownership details, if we enter corporation, in the next screen we have to give the details about the shareholders and % of shareholding etc.,
Business Benefits

The Benefits

  • Raw data is organized and handled efficiently
  • Easy to use
  • Data integrity is maintained
  • Useful for data analysis



Nesbitt Burns Inc, Toronto, Canada

Providian Financials, US

Citibank, US

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