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

The recent sharp selloff in Zions Bancorp’s stock already more than captures any credit risk associated with loan losses, but it neglects the overall quality of the bank’s financials, an analyst said Thursday.

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“That offers a nice opportunity to diversify risk because the underlying credit risk is actually from the financer,” she said.

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Dual worries over U.S.-China trade negotiations and credit risk for regional banks weighed on stocks last week.

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That selloff is “overdone,” Baird said, arguing that the credit risk is likely limited not just to Zions but to these particular loans.

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The $50 million loss is considered unique to specific borrowers, not indicative of systemic credit risk.

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