This course introduces the concept of Reverse Stress Testing Logic within the Credit Monitoring & Portfolio Surveillance framework. It focuses on identifying extreme scenarios and conditions that could lead to significant deterioration or failure of credit exposures, enabling proactive risk identification and mitigation.
Learners will explore key assessment dimensions such as control lapses, early warning signal identification, risk trend analysis, and proactive portfolio risk management, with an emphasis on independent validation and well-documented rationale. The course also distinguishes reverse stress testing logic from broader credit management processes, highlighting its specific role in uncovering hidden vulnerabilities and defining critical breakpoints in exposure performance.
By the end of the course, participants will understand how to apply reverse stress testing in practice, particularly within Stress Testing and Scenario Analysis, including setting portfolio limits, governing exception criteria, driving strategic alignment across the Credit Monitoring & Portfolio Surveillance function, and guiding escalation to the credit committee where required.