credit risk

noun

1. the possibility of loss if a borrower defaults on a loan.

2. a borrower regarded as likely to default on a loan.

Example Sentences

He claims that Deutsche Bank misused “netting” practices that allow banks to offset credit risk exposure, thereby inflating the bank’s capital and leverage ratios.

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Wall Street expects Oracle to borrow more debt in the future, thus increasing its credit risk.

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The company’s credit risk exploded in October, driven by concerns about its ability to finance its capex needs in the face of insufficient cash flow generation.

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One of the main risks of buying mortgages guaranteed by government-backed agencies, which takes credit risk mostly off the table, is that they prepay early when interest rates fall.

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Plus, there have been some reactions in markets for perceived credit risk among other firms.

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