scholarly journals Credit Information Sharing and Credit Risk Reduction in Kenya Commercial Banks

2016 ◽  
Vol 10 (1) ◽  
pp. 1941-1949
Author(s):  
Tabitha Nasieku ◽  
Rosemary Wanjiku Ngugi
Keyword(s):  
Credit Risk ◽  
Information Sharing ◽  
Risk Reduction ◽  
Financial Institutions ◽  
Commercial Banks ◽  
Theoretical Study ◽  
Financial Risks ◽  
Lending Policy ◽  
The Relationship

Financial Institutions are in the business of mobilizing and lending to borrowers and they assume various kinds of financial risks in the process of mobilizing and lending financial resources.This Theoretical study reviewed the literature to investigate the relationship between credit of information sharing and credit risk reduction in Kenya commercial banks. The literature found that the lending policy is periodically reviewed to reflect the prevailing conditions thus loan characteristics, considers an applicant's bank statements thus borrowers characteristics and the credit collection policy thus lenders characteristics before credit is advanced. The study recommends that banks should incorporate credit information sharing to reduce credit risk.

Examining the Relationship Between Banking Competition and Solvency, Liquidity and Credit Risks in Pakistan

2020 ◽  
Vol 4 (1) ◽  
pp. 29-52
Author(s):  
Sheikh Muhammad Umer Farooq ◽  
Muhammad Zubair Mumtaz
Keyword(s):  
Credit Risk ◽  
Financial Institutions ◽  
Commercial Banks ◽  
Banking Industry ◽  
Liquidity Risk ◽  
Foreign Banks ◽  
Banking Competition ◽  
Credit Risks ◽  
Private Banks ◽  
The Relationship

This study empirically examines the relationship between the banking competition and the risks faced by the financial sector (i.e. solvency, liquidity, and credit risks) considering 31 banks for the period 2001 to 2018. Banks are further sub-divided into three categories i.e. state-owned banks, foreign banks, and private/commercial banks. The results reveal that Pakistan’s banking industry is relatively elastic and an increase in competition is directly associated with solvency risk, liquidity risk and credit risk of financial institutions and these findings corroborate the competition fragility theory. Besides, state-owned banks have a lesser probability to cope with solvency risk, however, foreign banks appear to face the least liquidity risk whereas private banks appear to face the least credit risk among the entire cluster.

scholarly journals Customer Satisfaction in Retail Banking Services in Nepal

2019 ◽  
Vol 12 (1) ◽  
pp. 45-58
Author(s):  
Phul Prasad Subedi
Keyword(s):  
Regression Analysis ◽  
Customer Satisfaction ◽  
Financial Institutions ◽  
Commercial Banks ◽  
Retail Banking ◽  
Descriptive Statistics ◽  
Banking Services ◽  
Factors Affecting ◽  
Independent Variables ◽  
The Relationship

This research mainly focuses on analysing the factors affecting customer satisfaction in retail banking in Nepal. The study adopts descriptive and explorative research design to deal with the fundamental issues associated with various factors of customers’ satisfaction and retail banking. The study is based on questionnaire survey of 200 customers of 10 different “A” class financial institutions, i.e. commercial banks. Descriptive statistics, correlation coefficient and regression analysis have been applied to estimate the relationship between customer satisfaction as dependent variable and service quality variables as independent variables. The empirical evidences indicate that reliability, responsiveness, assurance and tangibles factors have positive and significant impact on customer satisfaction. It reveals that higher the level of responsiveness, reliability, assurance and tangibility higher would be the customer satisfaction.

scholarly journals Analysis of the Relationship between Credit Risk and Bank Performance of Some Commercial Banks in Ghana

2020 ◽  
Vol 8 (2) ◽  
pp. 34-51
Author(s):  
Joseph Acquah ◽  
Yusif Arthur ◽  
Damianus Kofi Owusu
Keyword(s):  
Credit Risk ◽  
Commercial Bank ◽  
Commercial Banks ◽  
Quantitative Research ◽  
Banking Sector ◽  
Sampling Technique ◽  
Capital Adequacy ◽  
Research Approach ◽  
Independent Entity ◽  
The Relationship

This study analysed the relationship between credit risk and bank financial performance of selected commercial banks in Ghana for the period 2010 - 2014, using the banks respective financial statements. The study employed the quantitative research approach. The sample was Ghana Commercial Bank Limited, Zenith Bank Limited, UT Bank and Ecobank Plc. These four banks were selected using stratified random sampling technique. The data were primarily secondary and quantitative in nature. Both descriptive and inferential statistics were used to analyse the data. When the banks were compared, Ghana Commercial Bank Limited was found to be more liquid than Zenith Bank Limited. That of Zenith bank was also higher than UT bank and Ecobank Plc .However, profitability indicators showed that Zenith Bank Limited and Ecobank Plc utilised its assets better than Ghana Commercial Bank Limited and UT bank resulting in the two banks higher scores over the period. The findings show further that Ghana Commercial Bank Limited showed higher ratios for investment in the future while Zenith Bank Limited showed higher ratios of higher dividend immediately. However, Zenith Bank Limited capital adequacy level was far higher than the legal requirement of Banking sector while its counterparts fell slightly below it in terms of average. Based on the main findings and conclusions, it is recommended that Ghana Commercial Bank Limited should find a means of reducing its expenditure, introducing prudent assets management, should be cautious when assisting government in time of economic difficulty, and operate as an independent entity.

scholarly journals Determinants of Credit Risk: Evidence From Commercial Banks in Malaysia

2021 ◽  
Vol 16 (1) ◽  
pp. 134-143
Author(s):  
Noor Hafizha Muhamad Yusuf ◽  
Mohamad Shukery Mohamad Shamsudin ◽  
Wan Mohd Yaseer Mohd Abdoh ◽  
Noor Sharida Badri Shah ◽  
Rozihanim Shekh Zain
Keyword(s):  
Credit Risk ◽  
Significant Relationship ◽  
Commercial Banks ◽  
Fe Model ◽  
Panel Regression ◽  
Return On Equity ◽  
Factors Affecting ◽  
Independent Variables ◽  
Interest Income ◽  
The Relationship

The purpose of this study is to determine the relationship between microeconomic factors with credit risk among selected commercial banks in Malaysia. For this purpose, a sample of seven out of 27 commercial banks in Malaysia was selected and the microeconomic factors affecting credit risk with six measurements of return on asset (ROA), bank size, leverage, the ratio of capital, interest income and return on equity (ROE) were examined by applying Panel Regression Fixed Effect (FE) Model for a period 20 years from 1998 to 2017. The scope of the study covers seven selected commercial banks in Malaysia namely: Affin Bank Berhad, Alliance Bank Malaysia Berhad, CIMB Bank Berhad, Hong Leong Bank Berhad, Malayan Banking Berhad, Public Bank Berhad and RHB Bank Berhad. This study is using credit risk proxy by non-performing loan for dependent variable while independent variables that have been selected were returned on asset (ROA), bank size, leverage, the ratio of capital, interest income and return on equity (ROE). The findings of the study managed to reject the null hypothesis for return on asset, bank size, leverage, interest income and return on equity which indicates the five microeconomic variables give a significant relationship with credit risk. There are positive relationships between leverage, interest income and return on equity with credit risk while return on asset, bank size and ratio of capital are negatively related to credit risk. However, the study fails to find any significant relationship between the ratio of capital and credit risk for commercial banks in Malaysia.

scholarly journals The Effects Of Ownership Structure And Listed Status On Bank Risk In China

2013 ◽  
Vol 29 (3) ◽  
pp. 695 ◽  
Author(s):  
Maoyong Cheng ◽  
Hong Zhao ◽  
Junrui Zhang
Keyword(s):  
Regression Analysis ◽  
Credit Risk ◽  
Ownership Structure ◽  
Commercial Banks ◽  
Capital Adequacy ◽  
Bank Risk ◽  
Capital Adequacy Ratio ◽  
Asset Quality ◽  
Relationship Of ◽  
The Relationship

This paper investigates the relationship of ownership structure, listed status and risk by using regression analysis based on the relevant data of Chinas commercial banks. Three main results emerge. First, compared to the state-owned banks, foreign-owned commercial banks exhibit better asset quality, lower credit risk and higher capital adequacy ratio; city commercial banks have lower credit risk and joint-stock commercial banks have lower credit risk and capital adequacy ratio. Second, listed status improves the asset quality and capital adequacy ratio. Finally, we also find that the listed status significantly moderates the relationship between ownership structure and risk. In conclusion, this study provides a theoretical reference for the reform of Chinas commercial banks.

scholarly journals Impact of credit risk (NPLs) and capital on liquidity risk of Malaysian banks

2017 ◽  
Author(s):  
Yaman Hajja
Keyword(s):  
Credit Risk ◽  
Commercial Banks ◽  
Positive Relationship ◽  
Liquidity Risk ◽  
Dynamic Panel Data ◽  
Bank Capital ◽  
Dynamic Panel ◽  
Macroeconomic Variables ◽  
The Impact ◽  
The Relationship

We investigate the relationship between bank liquidity risk and credit risk and the impact of bank capital on liquidity risk. Using 19 Malaysian commercial banks data over 2002-2011 and applying dynamic panel data GMM estimation after controlling for bank-specific and macroeconomic variables, empirical results document a positive relationship between liquidity and credit risk and a non-linear U-shaped relationship between bank capital and liquidity risk.

scholarly journals A Framework for Macro Stress-Testing the Credit Risk of Commercial Banks: The Case of Vietnam

2018 ◽  
Vol 14 (2) ◽  
pp. 1
Author(s):  
Oanh T. K. Vu ◽  
Yen H. Vu ◽  
Trang T. T. Nguyen ◽  
Trung H. Bui
Keyword(s):  
Credit Risk ◽  
Commercial Banks ◽  
Stress Testing ◽  
Inflation Rate ◽  
Var Model ◽  
Macroeconomic Shocks ◽  
Real Gdp ◽  
Set Up ◽  
Macro Variables ◽  
The Relationship

In this paper, we assess the capacity of Vietnamese commercial banks to withstand the effects of an increase in credit risk as a result of macroeconomic shocks. Firstly, VAR model is used to estimate the relationship among macro variables (real GDP, real exchange rate, lending interest rate and inflation rate) and from that, macroeconomic scenarios are set up. Next, we employ a GMM model to estimate the relationship between the non-performing loan ratio (credit risk) and macro variables involved in first step. Finally, the new capital requirement ratio (CAR) is recalculated, which is based on the increase in loan provision followed by the rise in non-performing loan. The results show that credit risk which the commercial banks have to face is relatively limited when their risk weighted assets are unchanged. If these numbers, however, increase as banks broaden their lending, all banks’ CAR will reduce remarkably and four large banks will be lack of capital seriously and cannot meet the requirement of Central Bank.

scholarly journals The Relationship between Credit Risk Management and Profitability between Investment and Commercial Banks in Palestine

2015 ◽  
Vol 7 (11) ◽  
pp. 163
Author(s):  
Mohammed Bayyoud ◽  
Nermeen Sayyad
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Regression Model ◽  
Commercial Banks ◽  
Banking Sector ◽  
Structured Interview ◽  
Investment Banks ◽  
Credit Risk Management ◽  
Bank Managers ◽  
The Relationship

<p>Credit risk management is one of the vital aspects of the financial institutions regardless of their nature. For a more comprehensive analysis of Palestine banking sector, investment and commercial banks both were chosen for assessing the relationship between credit risk management and profitability. Explanatory design of study helped in assessing the casual effect relationship between the research variables. The regression model was used for gathering quantitative findings while structured interview from bank managers was selected for gathering qualitative data. The findings of the regression model in the current study confirmed that there is no consequence of credit risk on profitability of commercial and investment banks of Palestine. Additionally, it was also found that there is no difference between the Palestinian commercial and investment banks concerning the relationship.</p>

scholarly journals Evolutionary Game Analysis of Blockchain Technology Preventing Supply Chain Financial Risks

2021 ◽  
Vol 16 (7) ◽  
pp. 2824-2842
Author(s):  
Rui Sun ◽  
Dayi He ◽  
Huilin Su
Keyword(s):  
Supply Chain ◽  
Credit Risk ◽  
Financial Institutions ◽  
Evolutionary Game ◽  
Decisive Role ◽  
Financial Risks ◽  
Factors Affecting ◽  
Blockchain Technology ◽  
Supply Chain Finance ◽  
Before And After

Because of the risks existing in supply chain finance, taking accounts receivable factoring business as the research object, this paper uses the evolutionary game method to analyzes the factors affecting the decision-making of the participants in supply chain finance, constructs an evolutionary game model between small and medium-sized enterprises and financial institutions, and analyzes the mechanism of blockchain to solve the financial risks of the supply chain by comparing the changes of evolutionary stability strategies before and after the introduction of blockchain technology. This paper aims to reduce financing risks by analyzing the mechanism of blockchain technology in supply chain finance. It is found that, firstly, blockchain technology can reduce the credit risk of financial institutions and solve financing problem. Credit risk plays a decisive role in whether financial institutions accept financing business decisions. Blockchain technology can reduce the operational risk of financial institutions and improve the business income of financial institutions. Secondly, the strict regulatory environment formed by blockchain technology makes the default behavior of small and medium-sized enterprises and core enterprises in a high-risk state at all times. No matter the profit distribution proportion that small and medium-sized enterprises can obtain through collusion, they will not choose to default, which effectively solves the paradox that small and medium-sized enterprises cannot obtain loans from financial institutions despite the increased probability of compliance. Then, the evolutionary game between financial institutions and small and medium-sized enterprises is balanced in that financial institutions accept business applications, small and medium-sized enterprises abide by the contract, and the convergence effect is better. Therefore, blockchain technology not only reduces the financing risk of financial institutions but also helps to solve the financing problems of small and medium-sized enterprises.

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