Unit 7 DB: Credit Risks Assume Maria, a small business owner, wants to...
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Unit DB: Credit Risks Assume Maria, a small business owner, wants to purchase an expensive truck worth $ She paid an amount of $ as a down payment and decided to take a bank loan for the remaining amount of $ to be paid back in year. The risk management department of the bank checked Maria's credit risks before issuing the loan. Maria, with low credit risk, gets the approval for loan allotment. Maria successfully paid a couple of installments of $ during the year. However, Maria had some big losses in her business due to offering goods on credit to customers with low credibility. The bank thinks that Maria might not be able to make any further payments against the loan. The current situation creates huge risks to the bank against a loan provided to Maria. Moving forward, what can the bank do to mitigate credit risk? Could the bank have done anything differently in Maria's case? Take into consideration how credit ratings are determined. With peers, discuss the importance of improving the risk assessment process. 
Unit DB: Credit Risks
Assume Maria, a small business owner, wants to purchase an expensive truck worth $ She paid an amount of $ as a down payment and decided to take a bank loan for the remaining amount of $ to be paid back in year. The risk management department of the bank checked Maria's credit risks before issuing the loan.
Maria, with low credit risk, gets the approval for loan allotment. Maria successfully paid a couple of installments of $ during the year. However, Maria had some big losses in her business due to offering goods on credit to customers with low credibility. The bank thinks that Maria might not be able to make any further payments against the loan. The current situation creates huge risks to the bank against a loan provided to Maria. Moving forward, what can the bank do to mitigate credit risk? Could the bank have done anything differently in Maria's case? Take into consideration how credit ratings are determined.
With peers, discuss the importance of improving the risk assessment process.
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