RISK MANAGEMENT BANKING STRATEGIES IN THE INFORMATION AGE
Research Article
RISK MANAGEMENT BANKING STRATEGIES IN THE INFORMATION AGE
ABSTRACT
The importance of the issue that is subject of this research stems out of the significance and relevance of the banking system stability, as a primary economic factor that is particularly apparent in times of financial crises. One of the key reasons for the serious difficulties and the severe financial crisis in which the financial institutions find themselves, is the inappropriate risk management in the banking operations. The increasing financial liberalization and the inventiveness in the contemporary world influence the rising offer of new banking products and services that carry intricate risks with them. The technology increasingly has, and shall continue to have, a key role in the risk management. In order to be able to adapt to the new global standards and regulations, banks would have to focus their attention towards reduction of transaction costs and to have prudent risk management. This means necessity to use the latest information techniques and technologies in the banking operations that will contribute towards offering new products and services, in higher quantity and at competitive prices. The implementation of the Basel standards also refers to the need for continuous improvement of the methods and strategies for measuring and strengthening of the risk management processes in the banking operations. Namely, in order to respond to the increasingly complex banking system to the need of international harmonization of the banking regulation and the need to strengthen the resilience of the banks towards financial distresses, the Basel Committee on Banking Supervision (BCBS) continuously revise the Basel standards introduced back in 1988. The long-term trends in the banking sector impose the need to use new, stricter methodologies for quantitative and qualitative risk measurement and management, including the need for development of new techniques that will enable their successful implementation. The reoccurrence of the financial crisis only confirms the fact that there is still room for further improvement of the risk management methodologies that were used. In this paper, special attention is paid to identifying methods and proactive strategic approaches that banks should adopt in order to build a strong team and efficient risk management processes in the information age. The rapid development of e-banking brings about benefits, but also risks. Risks in ebanking should be timely identified, controlled and properly managed by banking institutions. As it shown in this paper the technological complexity of the activities related to e-banking, as well as their rapid development particularly affect the intensification of strategic, operational and reputational risk. Analytic and field research was used for preparation of this paper. Additionally, analysis and synthesis methods have been applied. Internet was used as a major tool to approach data and literature.
PARNARDZIEVA STANOEVSKA, E.,
(2020). RISK MANAGEMENT BANKING STRATEGIES IN THE INFORMATION AGE. Trends in Economics, Finance, and Management Journal, 2(2), 17-26. Arrival Date Posted By:https://tefmj.ibupress.com/articles/risk-management-banking-strategies-in-the-information-age
