Credit Risk Manager Job Description, Key Duties and Responsibilities
What Does a Credit Risk Manager Do?
The credit risk manager is a professional who works to mitigate losses due to a borrower’s failure to make payment on any type of debt.
They may work in a variety of sectors that include lending clubs, banks, financial institutions, and other organizations with credit transactions and probability of loss arising from failure to settle debt.
Their job description entails providing the organization with advice on any potential risks to the profitability or existence of the company.
It involves identifying and evaluating threats, and developing alternative courses of actions to avoid, reduce, or transfer risks.
Credit risk managers are responsible for managing the risk to the organization, its employees, customers, reputation, assets, and interest of stakeholder.
Their role also entails developing and implementing policies and procedures that help to reduce the credit risk of the organization/financial institution.
They undertake building of financial models that predict credit risk exposure of the organization and oversee the preparation of performance reports for management.
They manage unsecured lending portfolio and continually optimize risk strategy for acquisition, fraud, and collection.
They utilize statistical and segmentation tools to develop/optimize acquisition risk strategies for personal loan products.
The credit risk manager work description also entails retrieving data and conducting data driven analytics, utilizing various analytical tools, software, and techniques.
It also involves conducting financial analysis and forecasting for program recommendations; tracking and analyzing performance of various tests and acquisition programs to evaluate effectiveness; as well as creating and monitoring regular MIS to track various acquisition programs.
Risk managers contribute to the team’s efficient and effective credit risk assessment, and credit adjudication and portfolio/risk management, and also prepare credit risk assessments and portfolio reporting.
They also work with team members to identify risk mitigation opportunities and develop/maintain portfolio reports that support this function.
They convince senior management to capitalize/take advantage of opportunities to invest in technology that can aid the credit department in cutting costs, accelerate decision making process, and/or improve the quality and consistency of credit decisions made.
To work as a credit risk manager requires knowledge of the lending policies, procedures and practices of the organization.
You must have an understanding of credit and the structures and protections required for corporate/commercial credit, and the ability to contribute to internal credit assessments and portfolio strategy discussions.
To be successful on the job requires financial, accounting, and computer literacy, as well as excellent written and oral communication skills.
The job also requires creativity, good judgment, and ability to take initiative.
It also requires strong analytical, negotiation, and problem solving skills, as well as a high level of commitment and strong sense of teamwork to succeed on the job.
Credit Risk Manager Job Description Example/Sample/Template
The credit risk manager performs various functions in addressing credit related issues, including but not limited to risk and underwriting guidelines, credit culture awareness, and credit policy support, and credit strategy support.
They play a key role in balancing asset growth with credit quality as part of achieving their group’s financial objectives.
The typical credit risk manager job description consists of the following tasks, duties, and responsibilities:
- Institute, lead, and deliver credit card fraud mitigation support
- Make sure alerts are readily available for business channels transactions
- Preempt fraud detection challenges at the strategy and portfolio level and provide analytical/modeling solutions
- Utilize customer data to build risk segmentation and mitigation strategies
- Establish and monitor policies and procedures that will foster the company’s potential to meet its sales and risk management goals. Monitor and assess active accounts to reduce or prevent bad debt losses
- Communicate current policies and procedures to subordinates and other affected parties
- Assist in controlling costs associated with operating and collecting credits
- Actively support efforts to identify credit risk related issues and coordinate issues resolution management
- Serve as Credit Risk PMO to ensure timely prioritization, execution, and delivery of key projects and initiatives
- Produce key management reports and respond to ad hoc requests by managing consumer credit risk reporting resources
- Support Senior Management with consumer risk reporting needs
- Ensure effective design and oversight of the consumer quality function; identify the scope and prioritize local quality control resources
- Maintain all Consumer Risk Policies and Procedures
- Provide support for strategic data initiatives such as ODS roll out, IDI, and DW
- Maintain and implement the IO Credit Risk Governance process
- Provide support for pricing and new product process for credit risk inputs (loss assumptions and product risk assessments)
- Follow-up and maintain tracking on open Audit, LRG, and self-identified credit risk issues to ensure satisfactory closure
- Manage cross-market as well as central/local credit risk activities.
Credit Risk Manager Requirements – Skills, Knowledge, and Abilities for Career Success
To be hired for the position of credit risk manager, you may have to fulfill certain requirements, including specific skills, abilities, knowledge, and experience to assure the recruiter that you will be able to carry out the purpose, obligations, and objectives they have set for the credit risk manager role.
Provided below are major requirements individuals seeking the job of a credit risk manager may be asked to fulfill to be considered for the role:
- Education: A minimum of Bachelor’s degree in finance, business, economics, or other quantitative related field is required. However, MBA or a Master’s degree in Economics, Mathematics, Statistics, or other quantitative related field may be preferred
- Knowledge: Credit risk managers require a working knowledge of consumer credit risk management and must possess sound market and industry knowledge of the sector in which they specialize
- They also require an understanding of the key drivers of consumer loan/credit card financials and the underlying consumer behaviors that drive those financials
- Computer skills: They require advance computer skills, especially proficiency with Microsoft Office (Excel, Access, Word, PowerPoint) applications; a working knowledge of SAS (Base, Macros) or SQL, R and Python is a plus, and other coding experience are acceptable. Experience in working with data and data manipulation tools may also be required
- Exceptional planning and organizational skills: They require the ability to handle several complex tasks simultaneously and also coordinate key projects with a variety of stakeholders is essential
- Communication skills: It is essential that credit risk managers possess great written and verbal communication skills to be able to work effectively with others. They must also be able to communicate and present technical information in a clear and concise manner
- Time management skills: They require good time management skills, the ability to effectively prioritize tasks, maintain timelines and manage/plan workloads effectively
- Leadership skill: They require the ability to direct and motivate a team in order to deliver a common goal
- Analytical skills: They must possess the ability to make deductions and meaning from rather complex and abstract situations and make sound decisions from them
- Eye for Details: A credit risk manager must be detail oriented. They must be able to flag down small but urgent information/situation where they are required to step in, and never lose sight of small day to day seemingly unimportant events
- Stress management skill: They must possess the ability to work under pressure and cope with stress in a coordinated and rational manner. It is essential that they can make sound and rational decisions even under stressful/ high pressure situations
- Negotiation and interpersonal skills: It is essential that they can negotiate and influence people towards achieving a predetermined goal.
If you are an employer or recruiter needing to make a good description for use in hiring for the credit risk manager position in your company, the content of this post, including the sample job description provided will be useful to you.
By making a detailed work description for the vacant credit risk manager position, interested persons for the role will be able to self-assess themselves for suitability for the job, which will increase your chances of having the best qualified applicants responding to your offer.
Also, individuals interested in the credit risk management career will find this article useful in learning about the duties and responsibilities managers in charge of credit risk departments commonly perform.
The post will help the individuals to better prepare for the career, and to also learn what they need to succeed on the job as a credit risk manager.
Did your knowledge and understanding of what credit risk managers do increase from reading this post? Please, make a comment in the box below. You may also discuss your job description if you work as a manager of a credit risk unit of a company.