Credit Risk Overview: Lessons from the Financial Crisis
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Credit Risk Overview: Lessons from the Financial Crisis

Intuition Publishing
Updated Sep 25, 2020

Both banks and regulators failed to understand or quantify the risks that were building up prior to the financial crisis. Here we describe the key mistakes made by banks and some other financial institutions, including too many concentration risks, a lack of understanding of products/risks, inadequate capital, funding and liquidity deficiencies, and issues with external credit ratings.