Risk management in banks as a mechanism for ensuring competitiveness

Abstract

The article investigates the current state and development of risk management systems in the banking sector. The authors analyze the practices of major Russian banks in risk management, identifying differences in organizational structure, control principles, risk management approaches, and the degree of digital technology adoption. Special attention is given to use of risk management as a tool for making advantageous strategic decisions, assessing capital reliability, and defining risk appetite, as well as implementation of machine learning and AI for evaluating customer creditworthiness. The findings of the conducted study indicate that competent risk management significantly reduces the consequences of risk implementation, minimizing losses on credit portfolios and enhancing service quality. The importance of risk culture, personnel management in the process of building customer loyalty, investor trust, and regulatory confidence is separately noted. The authors propose a concept of understanding risk management not only as a tool for ensuring stability but as a strategic mechanism for enhancing bank competitiveness as well, contributing to reputation building, customer acquisition, and improving operational efficiency in conditions of market volatility. The conclusion is drawn about the necessity for banks to apply risk management not only directly for compliance purposes but also proactively to achieve the highest competitive advantages.