Development of risk-based financial security management strategy for the bank

Abstract

The study proposes to build the bank’s financial security management strategy following on from a matrix formed by a combination of parameters defining the bank’s financial risk management efficiency and financial security, which has five zones that determine the content of the developed strategies: maintenance, strengthening, balancing, concentration, intensification, urgent action. This will contribute to the development of effective measures aimed at combining the tools for minimizing financial risks and improving the financial security of banking institutions. Thus, the proposed approach to selecting the bank’s financial security management strategy takes into account the level of financial risks that represent a source of threats to financial security. The study provides the indicators that characterize the credit, liquidity, interest rate, investment and resource base instability risks formed to quantify the financial risks. The summarized indicator of financial risk management efficiency of the bank being the study subject has been calculated by the taxonomic method and its qualitative levels on a scale constructed on the basis of the “golden section” method have been defined.