Such a rating framework is the basic module for developing a credit risk management system and all advanced models/approaches are based on this structure……” The credit rating assigned by a bank could be used for the following: a. Individual credit selection – to decide whether to lend or not to a particular borrower. b.
Supervisory stress testing can be a key building block of the macroprudential framework for CCPs if it accounts for the propagation of risk across CCPs as well as the spillover to, and spillback from, their clearing members.