MODELLING RISK MANAGEMENT USING SYSTEM DYNAMICS

Evaluating new bank loans has been considered as one of the main dilemmas that banks managers have to deal with in order to reduce the probability of default. Today in Kazakhstan and CIS countries risk management models are considered to be one of the major processes across all financial institutions. With the use of effective and efficient methodologies of risk assessment banks reduce themselves a probability of losses and even default. Thereby today all the issues arise around accuracy of forecasting credit losses and approaches that produce calculation methodologies of credit loss models based on various kinds of simulation. This paper describes the simulation tools and techniques that approach to provide risk management for banking sector.