credit risk

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Related to credit risk: Market risk, Liquidity risk, Operational risk

Credit risk

The risk that an issuer of debt securities or a borrower may default on its obligations, or that the payment may not be made on a negotiable instrument. Related: Default risk.

Default Risk

The risk that a debtor will be unable to pay back its loans. Default risk goes up if a debtor has large number of liabilities and poor cash flow. Generally speaking, companies and persons with high default risk stand a greater chance of a loan being denied and pay a higher interest rate on the loans they do receive. See also: Bankruptcy.

credit risk

The risk that a borrower will be unable to make payment of interest or principal in a timely manner.

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

References in periodicals archive ?

New and innovative computational approaches to assessing credit and credit risk

Kamakura Corporation Recognized As A Category Leader in Credit

Our analysis indicates that Islamic banks exhibit lower credit risk than do conventional banks (p < 0.01).

Credit Risk in Islamic and Conventional Banking

Credit risk is heightened by increased numbers of borrowers who fail to meet the repayment obligations on their loans, and is measured by non-performing loan rates.

New prakas released on grading of credit risk

* It is a consistent and easy way to talk about credit risk throughout the life of the loan, from underwriting to calculating ALLL

Why Credit Unions Should Care About Risk Rating

Risk components have been increased dramatically in the recent years, especially in the case of health and safety issues, it is also true in the case of financial products, for example, credit risk [4].

Assessing stakeholder's credit risk using data mining in construction project

D&B's Turkey Credit Risk Index for the third quarter of 2013 was 1072, slipping to 1035 in the fourth quarter.

Turkey's retail sector poses greatest credit risk

In the real credit risk contagion, the existence of correlated noises and their interactive driving is also prevalent and very often is the main cause for stochastic default of credit activity participants.

Complex dynamics of credit risk contagion with time-delay and correlated noises

This paper examines how the factors and characteristics of determinants of credit risk in Jordanian banking for the period 2006 to 2010.

Analysis the determinants of credit risk in Jordanian banking: an empirical study

Saunders, 1997, Credit Risk Measurement: Developments over the Last 20 Years, Journal of Banking and Finance, 21: 1721-1748.

Handling weather related risks through the financial markets: considerations of credit risk, basis risk, and hedging

When it comes to the assessment of an entire portfolio of accounts, Credit Value-at-Risk (CVAR) is used as a tool to measure and control the credit risk. Please keep in mind that no prescribed methodology exists for quantifying the capital required by a firm to back credit risk positions.

Introduction to Potential Future Exposure (PFE) and Credit Value-at-Risk (CVAR)

For months now, Washington's focus has quietly been shifting away from the theoretical constructs of Basel II and toward the very real risk issues of counterparty credit risk and liquidity.

Wall Street's derivatives casino: is today's eerily tranquil scene an illusion?

* using loan-to-value ratios, credit assessments, and other broad measures of credit risk for assigning risk weights to residential mortgages;