THE INFLUENCE OF FINANCIAL AND ECONOMIC FACTORS ON THE CREDIT PORTFOLIO MANAGEMENT OF A COMMERCIAL BANK ON THE EXAMPLE OF JSCB “LVIV”

Abstract

The article discusses the main factors that affect the formation of the bank's loan portfolio, as well as the risks associated with them. Assessment of financial and economic preconditions of credit risk management in the bank-ing system of Ukraine is carried out in order to create an effective management system. In the course of the research the main types of banks' loan portfolio were considered. It is determined that the type of loan portfolio is formed de-pending on the purpose of the bank activities. It is noted that the bank's loan portfolio should be considered as a set of assets that can be assessed, segmented, classified and managed. This need to assess the profitability, risk, liquidity not only of each operation, but also their totality. External and internal factors that affect the bank's loan portfolio are described. The negative impact of the pandemic outbreak caused by the COVID-19 virus on the economic activity of credit market participants has been revealed. It is determined that the main task of the bank's credit risk management system is to minimize credit risk while ensuring a sufficient level of profits in order to save depositors' funds and main-tain the bank's financial stability. General methods of credit risk management are studied. The measures taken by Bank “Lviv” to mitigate credit risks caused by the COVID-19 virus are highlighted. In order to determine the level of effi-ciency of the bank's credit policy, the current state of the loan portfolio of JSC JSCB “Lviv” was analyzed. The dynam-ics of the loan portfolio of Bank “Lviv” for the period 2017-2020 was also studied. The study revealed the impact of financial and economic factors on changes in the structure of the loan portfolio of Bank “Lviv”. The directions of im-provement of management of a credit portfolio of a commercial bank in the conditions of economic instability are de-fined.