ASSESSMENT METHODS OF FINANCIAL STABILITY IN COMMERCIAL BANKS

Abstract

Financial stability in commercial banks is a cornerstone of overall economic health and resilience. The increasing complexity of financial markets, regulatory changes, and evolving risk environments have intensified the need for robust and multidimensional approaches to assess banks' financial stability. This article analyzes the primary quantitative and qualitative methods used to evaluate the financial soundness of commercial banks, including ratio analysis, stress testing, the CAMELS framework, and advanced risk management models. The study draws on international practices and empirical research, highlighting the strengths and limitations of each method. The findings suggest that a combination of traditional and advanced assessment tools, backed by regulatory oversight and internal governance, is crucial for ensuring long-term financial stability in the banking sector