Understanding Credit Risk Contagion and Mitigation Strategies in Trade Finance
Credit risk contagion within supply chains arises when financial distress in one firm cascades through interconnected businesses, causing widespread liquidity issues and increased credit risk. Trade credit insurance plays a crucial role in managing these risks by protecting against non-payment and stabilizing cash flow. The COVID-19 pandemic has further transformed trade finance, highlighting vulnerabilities and
Key Modifications in Basel III and Their Impact on Banking Practices
The Basel III Endgame phase brings several crucial modifications aimed at enhancing the resilience of the banking system. Banks are required to increase their Tier 1 equity capital significantly, adopt a standardized approach for calculating risk-weighted assets (RWAs), and meet higher supplementary leverage ratios. New regulatory buffers and a phased implementation period ensure a gradual
