Credit Risk Assessment for Financial Institutions Activity

Sergii Kavun^1, and Mihail Vorotintcev²

¹Department of Information Technologies, Kharkiv Educational and Research Institute of Banking of the University of Banking, Victory Av., Kharkiv, Ukraine

²Department of Management of Financial Services, S. Kuznets Kharkiv National University of Economics, Kharkiv, Ukraine

Cite this paper:
Sergii Kavun and Mihail Vorotintcev. Credit Risk Assessment for Financial Institutions Activity. Journal of Finance and Economics. 2016; 4(5):142-150. doi: 10.12691/jfe-4-5-3

Abstract

The authors have presented analysis fundamentals and credit risk assessment in international practice based on statistical data of Ukrainian enterprises, such as financial companies and credit unions. The authors have been proposed a technique of assessments of the following indicators that have a significant impact (provided by the author) to assess the credit and financial institution’s activity. To solve this problem the authors offer a geometric interpretation to determine the aggregation vector as a level of credit risk, whereas we must consider all the indicators. Because their quantity of these indicators is three, then they are convenient to interpret in the 3D execution.

Keywords:
financial stability financial risk mathematical methods financial institutions risk management

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