Research On Credit Risk Of Mongolian Bank

Purpose of the article is to identify credit monitoring as a keystone of credit risk management in banks.CRM is widely discussed in scientific literature and in reports of institutions undertaking credit risk or supervisory bodies.However majority of such investigations are based on implementation of numerous quantitative or qualitative methods used for credit risk assessment before granting a loan or for credit portfolio risk management.There is a lack of information or investigations made on estimation of the need of credit monitoring in credit risk management process.Scientific aim is tostructure the early warning signs that reflect the condition ofcredits.The paper is based on analysis and resumption of various scientific andprofessional articles related to organization of credit process in banks.It combines results ofassessments of credit monitoring importance in credit risk management process made by theoreticalstudies as well as investigation of experts.Finding of the article is presentation of credit monitoring tools that should be applied forcorporate(and individual)clients via modification of original credit agreement.Conclusion of the article is that credit monitoring is akeystone in credit risk management process.The purpose of credit monitoring is to detect in timepossible worsening of the loan and to react(make changes in loan agreement).The simplest tool forcredit monitoring is to identify early warning signs in time that could be assorted into four groups:KRI of business environment;KRI with regard to management,KRI regarding collateral,KRI infinancial analysis.Limitation of investigation is impossibility of evaluation of importance ofmonitoring process in practice except investigation of experts(employees)directly responsible forcredit business.