Analyzing Credit Risk Management in Commercial Banks: An Exploratory Research about the Opinions of a Sample of Managers and heads of departments in selected commercial banks in Erbil City (2021).

Section One: - Introduction 1. 1 Preface Banks are vital to any healthy economy due to their crucial role in society. Nowadays, they provide a wide range of services and products. Their principal function is to transfer surpluses into deficit units by taking deposits from the community and giving them back to the community through lending (Paddy, 2012) as providers of financial resources and information to the economy. They even play a more critical function in developing economies. Borrowers, "individuals and businesses," have no easy access to capital markets. Therefore, well-functioning commercial banks accelerate economic growth, while poorly functioning ones hinder economic development and thus increase poverty (Muye and Muye, 2017).Lending is one of the principal types of banking activity, which is essential for meeting the ever-growing consumer needs and taking part in the production and socio-economic development of the country. Various forms and types of banking credits demonstrate that lending is the core of banking as a source of profit, while there is a constant demand from individuals and business entities (Yanenkova et al., 2021).On the other hand, these banks face different risks that need intervention with various protection ways to decrease these risks. Risk management (RM) is the procedure for identifying, monitoring, and measuring risk (Spucháková & Adamko 2015). One of these risks is CR, which these banks face due to lending and credit processes. CR is associated with the businesses of financial institutions as the financial position of a borrower deteriorates (Afriyie et al., 2018). Banks have developed credit scoring models to improve evaluating creditworthiness process during the credit evaluation process to reduce CR and promote lending quality (Paddy, 2012). 1.2 The Importance of the research: - Could be summarized as the following: - Managing CR allows commercial banks to understand the behavior of their customers to pre-assess their degree of the risk - The research reveals how important CRM is in financial institutions and how they cannot possibly be stable, achieve their future objectives and survive. - CRM improves the performance of commercial banks and secures a competitive advantage. - Advanced CRM prevents such banks from losses and the possibility of bankruptcy. 1.3 Objectives of the research: - They are explained as follows: - - To clarify CRM in selected banks. - The research aims to demonstrate the impacts of various CR policies implemented by such banks in Erbil city. - To determine whether the policies implemented as precautions contributed to risk reduction. - To assess the Central Bank's and monitory authorities' roles in controlling banking CR. - To evaluate the role of these banks' management in CRM. - To evaluate the CRM technology and software used by these banks. - To explain whether or not any other related factors affect CR. - To help researchers and bank decision-makers design and develop a proper, robust, and advanced CRM policy. - To add additional research in this field for interested people and to know more about CRM. 1.4 Research Problem: - According to the financial and banking literature, credit risks are the real threat to commercial banks' safety, stability, and survival. As a result, CR issues and the need for research and studies to offer specific ways and tools to mitigate their effects are needed. On the other hand, mismanagement of risks, particularly credit risks, and an improper study of risks scientifically and realistically have disastrous consequences on commercial banks' safety, stability, and survival. [ABSTRACT FROM AUTHOR]