scholarly journals Measurement and Comparision of Credit Risk Management Practice of Public and Private Banks Using Lending Ratios

2019 ◽  
Vol VI (2(1)) ◽  
pp. 48
Author(s):  
Reshma Prabhu Verlekar ◽  
Manoj S. Kamat
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Management Practice ◽  
Credit Risk Management ◽  
Public And Private ◽  
Private Banks

scholarly journals Feasibility Study of Credit Risk Rating Systems in Banks

2017 ◽  
Vol 6 (12) ◽  
pp. 294-306
Author(s):  
Lakshmi P
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Credit Risk Management ◽  
Credit Policy ◽  
Rating Systems ◽  
Public And Private ◽  
Risk Rating ◽  
Private Banks ◽  
Rating Model

Credit risk rating is an important tool used by banks to quantify risk associated with lending. Accuracy of the rating mechanism is an important aspect as it affects the nature and quality of credit decisions made. A wrong rating may affect not only the sustainability and goodwill of the banks; it can even affect the overall economic harmony and balance, as banks are barometers of the economy. Recent global economic crisis of 2008, itself showcases a need for very strict and accurate credit policy. Under this back drop, present study aims to analyze the credit risk rating mechanism of banks. A comparative study of the different risk rating models adopted by public and private banks in Thiruvananthapuram district (Kerala, India) is made and study attempts to determine the lacuna in the present risk rating model, if any. The study aims to provide suggestions to improve the credit risk management of banks.

scholarly journals Comparative Analysis of Risk Management Practices of Commercial Banks in Afghanistan

2021 ◽  
Vol 09 (01) ◽  
pp. 110-122
Author(s):  
Waqas Khan ◽  
◽  
Muhammad Tahir ◽  
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Value At Risk ◽  
Management Practices ◽  
Banking Sector ◽  
Credit Risk Management ◽  
Public And Private ◽  
Significant Difference ◽  
Private Banks ◽  
Public Banks

The main objective of the study was to compare the risk management practices of public and private banks and rank different types of risks faced by public and private banks in Afghanistan banking sector. The study empirically tested the level of efficient risk management practices in the banking sector of Afghanistan. A representative sample of 110 individuals was used from both public and private banks. The analysis was based on correlation, regression analysis, and t-statistics. The findings suggest that private banks are more efficient than public banks in terms of risk assessment and analysis, risk monitoring, and credit risk management. Furthermore, RAA, RMON, and CRA are the significant determinants of RMPS. Overall, there is no significant difference in the risk management practices of public and private banks. The study found credit risk, country risk, and liquidity risks as the major risks for the banking sector in Afghanistan. Financial statement analysis, audit and physical staff, and value at risk analysis are the three top instruments respectively for the assessment of risk. This study is the first attempt to understand and analyze the risk management practices of the banking sector of Afghanistan, the results of which will assist various stakeholders of the banking industry in their decision-making process.

An Investigation of Credit Risk Management Strategies of Private Commercial Banks of Bangladesh

2014 ◽  
Vol 2 (2) ◽  
pp. 77-87
Author(s):  
Abu Hanifa Md. Noman ◽  
Md. Amzad Hossain ◽  
Sajeda Pervin
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Commercial Banks ◽  
Management Practices ◽  
Management Practice ◽  
Management Strategies ◽  
Third Party ◽  
Primary Data ◽  
Credit Risk Management ◽  
Risk Management Strategies

Objective - The study aims to investigate credit risk management practices and credit risk management strategies of the local private commercial banks in Bangladesh. Methodology -The investigation is conducted based on primary data collected from a set of both closed end and open end questionnaire from 23 out of 39 local private commercial banks in Bangladesh. Descriptive statistics has been used in processing the data and interpreting the results. Findings - The results reveal that credit risk management practice of the sample banks is sound which is attributed to the appropriate implementation of Basel II and credit risk management guidelines the country's central bank. The findings further show that use of Credit risk grading is most popular and effective criteria for measuring the borrowing capacity of the borrowers. In order to control credit risk and preventing losses from credit exposure banks give more focus on collateralization, accurate loan pricing and third party guarantee. Loan is monitored properly and credit reminder is given to the client if principal and interest remain outstanding for three months. The study further reveals that lack of experienced and trained credit officers, lack of genuine market information and Lack of awareness regarding non-genuine borrower are the most important problems of current credit risk management practices in Bangladesh. Novelty - To the best of the knowledge of the authors the study is the first that investigates credit risk management strategies of private commercial banks, especially on Bangladesh. Type of Paper - Empirical Keyword : Bangladesh; Commercial Bank; Credit risk; Credit risk management; Credit risk management strategies.

scholarly journals Legislative Impact on Lending: Credit Risk Management in China

2011 ◽  
Vol 14 (04) ◽  
pp. 617-645 ◽  
Author(s):  
Zhaohua Li
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Commercial Banks ◽  
Management Practice ◽  
Commercial Banking ◽  
Chinese Government ◽  
Credit Risk Management ◽  
Before And After ◽  
The Government ◽  
Policy Lending

The Chinese government established the Act on Commercial Banks 1995 to enforce and regulate commercial banking activities. The government envisaged that the Act, together with other bank reforms, would improve credit risk management practice among commercial banks, hence, prompting the banks to reduce and ultimately stop local government directed policy lending to state-owned enterprises (SOEs). This paper examines the lending behavior of a government-controlled commercial bank before and after the passage of the Act. We find that the bank tightened control of the credit risk of borrowers after the passage of the Act. We also find that SOEs are charged a rate of interest higher than that charged to private firms.

scholarly journals The Impact of Credit Risk Management Indicators on Profitability Attributes: Evidence from the State-Owned Commercial Banks in Bangladesh

2021 ◽  
Vol 8 (3) ◽  
pp. 215-224
Author(s):  
Mst. Hasna Banu ◽  
Md. Sayaduzzaman ◽  
Subhash Chandra Sil
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Commercial Banks ◽  
Banking Sector ◽  
Management Practice ◽  
Management Policy ◽  
Annual Reports ◽  
Credit Risk Management ◽  
Management Indicators ◽  
The Impact

The focal attempt of this research is to identify the consequence of credit risk management indicators on profitableness attributes of state-owned commercial banks functioning in Bangladesh. To attain the objectives of this research study researcher has analyzed four sample banks’ audited annual reports covering the period 2012 to 2016. The study has employed the ANOVA technique, multiple regression model, and correlation matrix to reach the concluding remark as per study objectives. The findings revealed that there is significant and insignificant variation as well as relationship in the different indicators of credit risk management but there is insignificant variation in the different attributes of profitability in the midst of the sample banks within the study period. Furthermore, there is the insignificant impact of the different indicators of credit risk management namely loan and advance, classified loan, unclassified loan, leverage ratio, bad debt, default ratio, cost per loan asset, and cost to income ratio on profitability attributes such as return on assets, return on equity along with net profit percentage of the sample banks over the study period. Hence, the study has recommended that the management of the banking sector should emphasize creating a smart credit management policy as well as lending guidelines to formulate the suitable credit risk management practice to meet the demand of loans applicants properly.

scholarly journals THE EFFECT OF CREDIT RISK MANAGEMENT ON PROFITABILITY: AN EMPIRICAL STUDY OF PRIVATE BANKS IN SYRIA

2018 ◽  
Vol 3 (2) ◽  
pp. 43-51
Author(s):  
Allam Yousuf ◽  
János Felföldi
Keyword(s):  
Risk Management ◽  
Empirical Study ◽  
Credit Risk ◽  
Capital Adequacy ◽  
Credit Risk Management ◽  
Financial Reports ◽  
Capital Adequacy Ratio ◽  
Private Banks ◽  
Quantitative Manner ◽  
The Relationship

The objective of this study is to investigate the effect of credit risk management on profitability in private banks in Syria. Two main criteria have been adopted for the management of credit risk in banks: capital adequacy ratio and non-performing loans. In order to achieve the objectives of the research and to test the hypotheses, an appropriate non-probability sample numbering 6 private banks was selected from those private banks in Syria for which financial reports and risk management reports were available sequentially from 2007 until 2011, because the researchers wanted to investigate the relationship between variables within normal conditions not in the light of instability in Syria. Credit risk was measured by the capital adequacy ratio (CAR), and non-performing loans (NPL), whereas profitability was measured by the ROE indicator by calculating the data and financial reports of sampled banks and showing them in a quantitative manner and identifying the relationship between the variables by using the SPSS program to study the correlation and build the regression equation. The study concluded that there is a statistically significant relationship between capital adequacy and profitability, the capital adequacy ratio affects profitability negatively. Non-performing loans do not effect profitability (ROE). In general, credit risk management accounts for 19% of the profitability of banks.

Retail Credit Risk Management in Indian Public Sector Banks

2012 ◽  
Vol 3 (8) ◽  
pp. 31-37
Author(s):  
Nayan J. Nayan J. ◽  
◽  
Dr. M. Kumaraswamy Dr. M. Kumaraswamy
Keyword(s):  
Risk Management ◽  
Public Sector ◽  
Credit Risk ◽  
Credit Risk Management ◽  
Public Sector Banks ◽  
Retail Credit
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