Banks today is highly complex organization offering multiple services through various departments, each staffed by specialists in making different kind of financial decisions.Banks today realize that all these management decisions are intimately linked to each other. In a well managed bank all of these management decisions must be coordinated across the whole bank to ensure that they do not clash with each other. For the project I have selected topic “credit risk management” because of my personal interest in doing something in financial sector especially in the banking sector because banks today focus heavily on the managing risk, attempting to control the exposure to loss due to changes in the interest rate the inability or unwillingness of borrowers to repay their loans, changing currency prices and other risk laden factors. But effective management of risk requires careful coordination of decisions made on the asset side of a bank with the decision made on liabilities side. Thus bankers use different techniques of risk management that can be marshaled in a coordinative fashion to handle many risks.