This course introduces the concept of Reverse Stress Testing Logic within the Credit Monitoring & Portfolio Surveillance framework. It focuses on identifying the extreme scenarios and conditions that could lead to significant deterioration or failure of a credit exposure, enabling proactive risk 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 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 validation of team-level analysis, approval of case recommendations, management of segment-level exposure, and escalation to the credit committee where required.
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