Banking Risk Management in a Globalizing Economy Essay - 1

Banking Risk Management in a Globalizing Economy - Essay Example The second part discusses the linked risks to banking globalisation with reference to the 2007-2009 global financial crisis. One of the obvious reasons as to why banks manage to go international in their operation is their ability to deal with risks. In the age of modern technological advancement, banking technology is becoming an integral component of the decision-making process (Hughes and Mester, 2008, p.1). Information is vital in the decision-making process (Timmerman et al., 2008, p.113). With sufficient information, there is an available tool that can aid in the decision-making activity. In the case of banks, especially those performing in the international setting, they evaluate and manage risks, by simply referring to their databases and online information, making them easily have access to problematic clients, and problems that are non-performance that require immediate attention. Banks are always on the go to measure risks (Angelopoulos and Mourdoukoutas, 2001, p.158). Aft er all, risks are associated with their banking business activity. When banks started to employ diversification process in the global background, prior to initiating it, they have already calculated the level of risks facing them. However, the reason as to why they still go forward to investing their business at the global level is their ability to mitigate the presence of threats. The advancement of technology and their ability to adapt it in their entire working system are the mere advantages they have over the presence of varied risks. In other words, one of the reasons why banks go international in their operation is due to their capability to manage risks. They have vital aid that could support them in times of tough decision-making activity, allowing them to decide what is best for their clients and in their whole business operations.