credit risk

American  

noun

1. the possibility of loss if a borrower defaults on a loan.

2. a borrower regarded as likely to default on a loan.

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Example Sentences

He claims that Deutsche Bank misused “netting” practices that allow banks to offset credit risk exposure, thereby inflating the bank’s capital and leverage ratios.

From MarketWatch

Wall Street expects Oracle to borrow more debt in the future, thus increasing its credit risk.

From Barron's

The company’s credit risk exploded in October, driven by concerns about its ability to finance its capex needs in the face of insufficient cash flow generation.

From Barron's

One of the main risks of buying mortgages guaranteed by government-backed agencies, which takes credit risk mostly off the table, is that they prepay early when interest rates fall.

From The Wall Street Journal

Plus, there have been some reactions in markets for perceived credit risk among other firms.

From BBC