ANALYSIS OF RISKS AND MANAGEMENT STRATEGIES IN THE BANKING SECTOR AMIDST FINANCIAL INSTABILITY
Abstract
The article explores the issue of risk analysis and management strategies in the banking sector amidst financial instability. It analyzes the theoretical aspects of risk management in banking activities, defines financial instability and its impact on the banking sector. The methods and tools for risk analysis in the banking sphere and their effectiveness under instability are discussed. Key risk management strategies are identified, such as portfolio diversification, establishment of adequate reserves, and the use of financial instruments for risk protection. Based on practical cases of risks in the banking sector, an evaluation of the effectiveness of risk management strategies is provided. The conclusions of the article aim to underline the importance of understanding and effectively managing risks to ensure the stability of the banking system in times of financial instability. The article explores the problem of risk analysis and management strategies in the banking sector under conditions of financial instability. It analyzes the theoretical aspects of risk management in banking activities, defines financial instability and its impact on the banking sector. Methods and tools for risk analysis in the banking sector and their effectiveness in unstable conditions are considered. The main risk management strategies are identified, such as portfolio diversification, creating adequate reserves, and using financial instruments to hedge risks. Based on practical cases of risks in the banking sector, an assessment of the effectiveness of risk management strategies is provided. The conclusions of the article aim to emphasize the importance of understanding and effectively managing risks to ensure the stability of the banking system in conditions of financial instability. This comprehensive approach to risk research in the banking sector takes into account the complexity and dynamics of the modern financial environment. Compared to previous decades, today's banks are dealing with more complex and diverse threats, which include not only economic and financial risks but also technological, cybersecurity, and socio-economic challenges.
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