The role of the banks' rating system in the allocation of loans
Slobodan Šegrt,
Dragan Vučinić,
Milan Mihajlović
et al.
Abstract:The subject of this paper is the analysis of the application of banking internal credit risk measurement models for the purpose of calculating the minimum regulatory capital. The Basel Committee established proposals for an internal rating-based approach (IRB approach-internal rating-based) to capital requirements for credit risk. Such an approach, which relies on the bank's internal assessment of counterparties and exposures, can ensure two key objectives: the first is additional risk sensitivity, in which ca… Show more
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