The Risk Assessment of Banks and Financial Institutions

Abstract

This thesis investigates the profound impacts of the COVID-19 pandemic on the banking sector, focusing on how the crisis has reshaped risk management and operational strategies. It begins by contextualizing the pandemic's effects within the broader historical challenges faced by the banking industry, drawing parallels with past financial crises to outline the uniqueness of the current situation. Through a detailed analysis of operational, credit, and market risks, this study reveals how banks have responded to the increased volatility and the shift in consumer behaviors towards digital banking solutions. The research adopts a mixed-method approach, combining quantitative data from financial reports with qualitative insights from industry experts to provide a comprehensive overview of the pandemic's impact. Key findings suggest that the crisis has catalyzed significant changes in risk management practices, with banks rapidly adopting technological innovations to enhance resilience and operational efficiency. The conclusion posits that the ongoing challenges require banks to evolve, advocating for a proactive approach to risk management and a strategic embrace of digital transformation. This thesis contributes to the academic literature by providing empirical evidence of the pandemic's impacts and offers practical recommendations for banks and policymakers to mitigate future crises effectively.