CREDIT CONCENTRATION AND RISK MITIGATION IN IRAQI BANKS (2010-2019)

One of the most significant risks that bank management encounters when making loan decisions is concentration risk in a credit portfolio. This risk arises from the bank's concentration in working with a single borrower, a particular economic sector, or a particular geographic area that is sensitive to one or more economic factors, putting the bank at risk of significant losses. Therefore, the concept and various forms of banking concentration risks, such as individual and sectoral concentration risks as well as concentration risks in the credit portfolio's individual components (structural concentration), will be covered in this study. A variety of techniques, including the modified particles method, the Her vandal index, the adjustment factor, and others, will be used to measure the risks of credit concentration. Furthermore, the key strategies for limiting, reducing, or lessening these risks will be covered, including risk transference, covering, and diversification of the loan portfolio, as well as restrictions, specifications, and insurance. As the data demonstrate that there is a credit concentration at the sectoral, structural, and top five operational Iraqi banks levels, an analysis of the credit concentration in the country's commercial banks will be conducted during the 2010-2019 timeframe as part of the research's practical component.