ACTIVE RISK MANAGEMENT AND BANK STABILITY
Keywords:
Risk management, banks' and financial institutions' stability, credit risks, operational risks, market risks, liquidity risks, corporate governance, strategic strength, and compliance with regulatory requirements.Abstract
This research examines the critical role played by proactive risk management in supporting stability and resilience at banking institutions in a changing financial landscape. It highlights the interlinked character of different risk types—i.e., credit, market, operational, and liquidity risks—and emphasizes the need for an integrated and systematic risk identification, analysis, and mitigation strategy. The research findings reveal that robust risk management not only prevents financial crises from occurring but also improves decision-making, fosters investor confidence, and ensures long-term sustainability at institutions. By embracing risk-based thinking and building a risk-conscious culture, financial institutions are better able to improve governance, maintain regulatory compliance, and gain a competitive advantage in the market.
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