Credit Risk Management In Hong Kong Banking

Since 1980's, the impact of globalization and financial freedom become more and more important. The Credit Risk Management Theory of Banking has been evolved from the traditional to the contemporary ones, which include Market Risk, Credit Risk, Liquidity Risk, Operational Risk etc.; the methodology and the features of the techniques become more and more quantified and modeled. The objective of credit risk management in banking is to control the acceptable credit risk in order to maximize the risk adjusted return. This thesis studied the current situation of Hong Kong Banking Industry by demonstrating the different risk measurement approaches; the internal control and the external risk control mechanism. It also explored the new trend of risk management and evaluated the effectiveness of the measures and made relative suggestion in order to further improve the risk management in Hong Kong.