Risk basics and the risks a bank runs

Module 01 / 5 · 60 min · Free preview

Understand what risk is, why banks fail, and the main risk types an Ethiopian bank faces, each with a local example.

In this module you will learn to

Explain risk, uncertainty and the link between risk and return
Describe the common reasons banks fail and relate them to Ethiopian experience
Name and explain credit, market, liquidity, operational, compliance, IT and cyber, strategic, reputational and climate risk
Give an Ethiopian example of each main risk type

Built on

Erudite Africa course specification: 4.b Risk Management Framework, Levels 1 and 2 (October 2026)
Erudite Africa: Training Module, Ethiopian Context, programme overview and regulatory register (October 2026)
NBE Risk Management Guidelines (May 2010)
NBE directives as listed in the lessons: SBB/87/2024, SBB/88/2024, SBB/90/2024, SBB/91/2024, SBB/93/2025, SBB/95/2025, SBB/96/2025, FXD/01/2024, NBE/INT/13/2026
National Bank of Ethiopia Proclamation No. 1359/2025; AML/CFT Proclamation No. 780/2013 and Personal Data Protection Proclamation No. 1321/2024 (as reported)
International frameworks: COSO ERM (2017), ISO 31000, Basel Core Principles for Effective Banking Supervision

Examples and organizations are fictional. Apply your own organization's approved policies.