Literature on Portfolio Optimization of Commercial Bank Credits

Abstract

Ziyodilloyev Xushnud

This paper focus on portfolio optimization of commercial banks’ credits. Managing the efficiency of the banking sector is of particular interest to all players in the financial market. A lot of studies have shown that after the mortgage bond crisis, banking structures have become more conservative in the allocation of financial resources and risk assessments. The assessment of the efficiency and quality of the credit portfolio is directly related to the determination of the role of credit operations in the bank’s activity, the level of effective use of the bank’s credit potential, the level of risk of credit operations through the analysis of interest rates and income from loans, interest margin, overdue loans.

Data indicated that the optimal credit portfolio in Uzbekistan’s banking system would depend on various factors, including the current economic conditions, the risk appetite of the banks, the regulatory environment, and the creditworthiness of borrowers. Therefore, in general, an optimal credit portfolio for banks in Uzbekistan should be well-diversified, balanced, and aligned with the country's economic development priorities.

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