Strategic framework for managing forces of continuity and change in risk management of Banks in India

The paper presents a basic understanding of the banking industry, the types of risks faced by it and the measures adopted for efficient risk management. It looks into the risk management system of five leading International and National banks operating in India. There are three basic types of risk faced by the banking industry are: Credit risk, Market risk and Operational risk. The study focuses on credit risk which is the possibility of loss due to changes in quality of counterparties. Because there are many types of counterparties - from individuals to sovereign governments - and many different types of obligations - from auto loans to derivatives transactions - credit risk takes many forms. Institutions manage it in different ways. The study focuses on understanding the forces of Continuity and Change affecting Risk Management of these banks and evolving a strategy to cope up with the environment and the competitions. © 2009, Global Institute of Flexible Systems Management.