Basel Committee issues sound practice principles for credit risk assessment for loans
The Banking Committee on Banking Supervision has released a consultative document outlining principles for 'Sound Credit Assessment and Valuation for Loans'.
The Committee's supervisory guidance is structured around 10 principles falling into two broad categories: supervisory expectations concerning sound credit risk assessment and valuation for loans, and supervisory evaluation of credit risk assessment for loans, controls and capital adequacy.
Under supervisory expectations, the guidance suggests the board of directors and senior management should ensure that the banks have appropriate credit risk assessment processes and effective internal
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