In my previous post, I discussed some of the more negative findings from our new European Credit Risk Outlook. But it’s not all doom and gloom.
In our recent survey, credit risk managers across Europe clearly indicate that they are better prepared now to deal with a rise in risk. 77 percent of respondents say that they have made changes to their risk management processes to deal with the economic downturn since 2008. They also say that their approach to risk management is more disciplined than three years ago (83 percent) and that they can adapt policies rapidly (79 percent). A full 97 percent say that their credit decisions are made with a strong understanding of borrower debt capacity.
Credit risk remains a challenge in most markets today, due to unemployment, sovereign debt concerns and weak economic results. The good news is that lenders are better prepared now than they were three years ago.