Diversification of Banking Risks in the Context of Financial Globalization

Abstract

Diversification of financial activity involves the use of alternative income opportunities from various financial transactions - short-term investments, formation of the loan portfolio, portfolio of long-term investments, and the implementation of real investment. In today's highly integrated monetary relations, risk is not an integral part of the economic system. Sensibility to risk increases; factors of its occurrence are becoming more diverse, and the opportunity to diversify and these risks is less realizable in practice. Diversification of banking risks in the context of financial globalization is the basis for the stable operation of the Russian banking sector, in the context of rapidly changing external and internal market conditions, creates a safety factor of strategic development and reform the economy as a whole. Understanding that the risks for the banking activities are not so much the potential loss as possible benefits, involves the development and implementation in practice of new concepts and models of risk diversification for banking activities, leading to the quality of its content mandatory requirements of regulators in the area of risk control.

DOI: 10.5901/mjss.2015.v6n3s3p147