We are exposed to various risks that are integral to any banking business, with the major risks being credit risk, market (including liquidity) risk and operational risk.
Our objective is to ensure that there is an appropriate balance between risks and return; and we have implemented comprehensive policies and procedures to identify, monitor and manage risk throughout our Bank. Our risk-management mechanism is based on the understanding of various types of risks, disciplined risk assessment and continuous monitoring, including relying on comprehensive processes and internal control mechanisms for effective and continuous monitoring and control of risks.
During fiscal 2020-21, we continued to strengthen our risk management framework and implemented several steps to improve our policies, structures and processes. These measures include:
Focused on portfolio diversification to reduce concentration risks, including less exposure to project loans and added emphasis on transaction banking and working capital businesses.
Higher quality credit portfolio, with fresh originations predominantly from entities rated Aor better.
Continuous credit monitoring and improved early warning systems for potential stress.
More collections through optimised queuing strategy and channel selection.