Prepayment Risk Monitoring

Definition

Prepayment Risk Monitoring is the collection of practices used by lenders or other counterparties exposed to Prepayment Risk to assess the ongoing development of the borrower (obligor) prepayment risk profile and behavior in changing portfolio and economic environments.

Benefits

The aim of Prepayment Risk Monitoring is to identify any developing risks and issues as soon as possible in order to facilitate optimal mitigation using hedging and other technique