Credit Risk and Interest Rate Risk Fundamentals

Course Overview: Every loan you work with carries risk—and that risk can change over time. In this course, you’ll build a practical understanding of credit risk and interest rate risk, two of the most important forces shaping loan performance and institutional profitability. You don’t need to be a credit expert or a treasury specialist. What you do need is the ability to recognize how these risks show up in your day-to-day work—and what to do when conditions begin to shift.

You’ll learn how to identify primary and secondary sources of repayment, evaluate borrower strength using proven frameworks, and understand how loan structure affects risk over time. You’ll also explore how rising or falling interest rates can impact both your institution and your borrowers—and how those risks can quickly connect.

Through real-world scenarios and guided decision points, you’ll practice spotting early warning signs, assessing what’s changed, and determining the right next step.

By the end of the course, you’ll be able to talk about risk more clearly, make more informed decisions, and contribute more confidently to conversations with borrowers, credit partners, and leadership.

Learning Objectives:

• Define credit risk and interest rate risk in practical banking terms.

• Identify the primary and secondary sources of repayment in a loan scenario.

• Recognize how borrower capacity, loan structure, and monitoring signals affect credit quality over time.

• Distinguish between institution-level interest rate risk and borrower-level rate stress.

• Recognize early warning signs that may indicate a changing credit risk profile.

• Select an appropriate next step when borrower performance, structure, or rate conditions begin to change.

Audience: Lenders

This course takes approximately 60 minutes to complete.

*This course does NOT qualify, nor meet the National Standard for NASBA accreditation.