• ISSN: 2010-023X
    • Frequency: Bimonthly
    • DOI: 10.18178/IJTEF
    • Editor-in-Chief: Prof.Tung-Zong (Donald) Chang
    • Executive Editor: Ms. Cherry L. Chen
    • Abstracting/ Indexing: Engineering & Technology Digital Library, ProQuest, Crossref, Electronic Journals Library, DOAJ , EBSCO, and Ulrich's Periodicals Directory
    • E-mail: ijtef@ejournal.net
IJTEF 2012 Vol.3(6): 441-444 ISSN: 2010-023X
DOI: 10.7763/IJTEF.2012.V3.242

Stress Testing in Risk Management: An Application in the Turkish Banking Sector

Ismail Yıldırım
Abstract—Stress testing is a risk management tool used to simulate extreme but plausible events and measure how the events would impact firm’s income. Stress testing aims to identify extreme events that could trigger catastrophic losses in a given portfolio. Here, exceptional refers to events of high severity and plausible excludes improbable scenarios. Stress tests also provide actionable information to senior management for decisions around capital allocation and contingency planning. This paper revealed that the Turkish banking system was robust to a number of adverse shocks.

Index Terms—Value-at-risk models, stress testing, market risk, scenario analysis, turkish banking sector.

I. Yıldırım is with the vocational school, Hitit University, Çorum, Turkey (e-mail: ismailyildirim@hitit.edu.tr ).


Cite:Ismail Yıldırım, "Stress Testing in Risk Management: An Application in the Turkish Banking Sector," International Journal of Trade, Economics and Finance vol.3, no.6, pp. 441-444, 2012.

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