Kuzmak O. Banking risk management: theory, methodology and practice

Object ? the process of risk management in banking. Purpose ? substantiate theoretical and methodological foundations of banking risk management and to improve the scientific, methodical and practical recommendations aimed at strengthening the development conception of banking risk management in the domestic banking system. Methods ? the methods of analysis, synthesis, comparison, generalization; empirical research methods, abstract, logical and constructive methods have been applied. Results ? scientific substantiation of theoretical and methodological foundations of banking risk management; the formation of conclusions and practical recommendations for the improvement of risk management in the domestic banking system. Novelty ? the theoretical conceptualization of banking risk management has been developed, based on an integrated approach to the formation of organizational, economic, functional and legal framework which will help to reveal the essence of this concept; the author's understanding of the essence of "economic capital" of the bank has been shown which will provide the opportunity to quantify banking risks; proposed four main stages in the strategic management of banking risks have been outlined; improved concept of "banking risk" has been given which focuses not only on the avoidance of risk, but also emphasises the big importance of banking risks management; introduced new criteria for the classification of banking risks; systematic factors of the banking risks in the domestic banking system; а new approach to the assessment of the banking risks at the macro-level has been proposed; the techniques of banking risks management have been systematized; depending on the management level which will help to distinguish between these techniques both at the micro- and the macro-level; the definition of the concept of "operational risks" has been improved which unlike the previous ones, outlines the risk of the organizational structure; the organizational approach to risk management in banking institutions has been improved by creating a coordination centre dealing with risk management; determine the specific principles of banking risk management of effectiveness, consistency and efficiency; proposed the scientific and methodical approach to the assessment of operational risks. They are implemented in practice National Bank of Ukraine, the branches of National Bank of Ukraine in Ternopilska and Rivnenska regions, PJSC "Agrocombank", Regional branch of PJSC "Prominvestbank" in the city of Rivne. Scope ? the activity of the Association of Ukrainian Banks, the Committee on Financial Policy and Banking of the Parliament of Ukraine, the Ministry of Finance of Ukraine.