RISK MANAGEMENT IN MODERN BANKING

The article deals with risk management, risk culture and their trends in modern banking that are based on IT development. The specificity of credit institution business leads banks to high risk exposure, usually systemic one; the banking crises being good examples. The latest global financial and economic crisis of 2008-2010 showed weak aspects both in banking regulation and monitoring and in banking management itself. Risk transformation and risk management are the key functions of banking management in general. The more precise the risk estimation is, the more adequate decision the bank managers have, the more efficient banking management would be and the less is the possibility of the bank's bankruptcy. Traditional approaches to the analysis of a bank institution behavior are based on the principles of financial management (portfolio analysis). Unlike a trade or industrial firm, a bank is a more complicated, more closed and less transparent organizational structure. When analyzing main characteristics of inner architecture of a financial credit company, we can see a clear tendency towards a new character of a bank as a special economic actor. Before 2000s banks were treated as risk neutral market participants, but nowadays it has been put forward that banks are risk averse agents. This approach have become prevailing after global financial crisis of 2008-2009. In information technology era, the risk management system in financial institutions is closely related with the IT infrastructure, its architecture and its development. The important indicator of efficient risk management in modern banking and significant risk culture is the growing number of IT products elaborated for process of risk management that help form a good system for effective reaction on risk situations. The example of an efficient IT system in Sberbank, which is the most advanced bank in Russia, is demonstrated.