An Empirical Study on Determinants of Loan Repayment Behaviour of SMEs Towards Commercial Banks

India, as a developing economy even after five decades of planning, still has a long way to catch up with the advanced economies of the globe. The goal may be distant, but surely, the time needed to reach can be reduced by accelerating the pace of development. One way of doing this is by the development of industrial and business ventures. There exists a positive relationship between the growth of an economy and the growth of small and medium enterprises (SMEs). SMEs play a vibrant role in the development of an economy. Access to the formal source of credit by entrepreneurs is essential in a growing economy. Lending to SMEs is a risky activity for the banks as repayment of these loans are less guaranteed. The research article attempts to analyse the factors influencing the loan repayment behaviour of SMEs towards commercial banks. Data are collected using the convenience method of sampling from 80 registered SMEs belonging to the manufacturing and service sectors in the Bangalore region, and data are analysed using statistical tools such as correlation and logit regression analysis, conclusions are drawn based on these findings. The study reveals that characteristics of loan and lender influence the repayment to the maximum extent. The findings are helpful for commercial banks in redesigning suitable policies and schemes to reduce loan defaults.

Savings Level Determinants and Sustainability of Commercial Banks in Rwanda: A Case of I&M Bank Rwanda

The purpose of this study was to investigate the effect of savings level determinant on sustainability in I&M Rwanda. The specific objectives were to establish the effect of interest rate, income level and access to credit on the sustainability of I&M Bank. This study implemented a descriptive research design and utilized coefficient of correlation to assess the effect of each specific objective on the sustainability of the Bank. The population comprised of 12,057 including 12,050 customers and 7 staff of finance department of I&M Bank Rwanda. A sample size of 99 was calculated using Yamane (1967) simplified formula. To accomplish this aim, both primary and secondary data are used. The researcher used simple random and purposive sampling techniques. A questionnaire and interview have used to collect data. Quantitative data was obtained using questionnaire while a financial statement of I&M Bank covering 2016-2020 was used as secondary data. Descriptive and inferential statistical analysis showing mean, standard deviation, correlation and regression was used statistical Package for Social Sciences (SPSS) version 26.0 to analyze statistical information while content analysis used to analyze qualitative information. The findings and recommendations for this study addressed to the I & M Bank Rwanda, for decision-making and policies. The study found that interest rates, income level and access to credit have significant positive effect on sustainability of commercial banks in Rwanda at 78%, 90.5% and 92.9% respectively. The relationship among saving level determinants and sustainability of business bank was also determined to be linear with increase in get admission to credit score by means of clients. The researcher concluded that saving degree and get admission to credit volatility had more effect on sustainability of banks. The study endorsed that guideline to be installed vicinity to boom financial institution lending and ensure monitoring the same. Keywords: Savings Level Determinant, Sustainability, Commercial Banks, I&M Bank, Rwanda

Financial performance of commercial banks in the emerging markets

In the economic growth of a country, the banking sector plays a significant role (Alam, Rabbani, Tausif, & Abey, 2021). The overall objective of the study is to investigate the financial performance of commercial banks in emerging markets. The study tried to see the impact of governance, exchange rate volatility, trade openness, and internet access on the financial performance of commercial banks in Ethiopia during the years from 2014 to 2019. The study employed a random-effects model using balanced panel data. The result indicated that composite governance index, trade openness, and internet access have a positive and statistically significant effect on the financial performance of commercial banks as measured by their return on assets. However, the exchange rate volatility has a negative and statistically significant effect on the financial performance of commercial banks. On the other hand, the result of bank-specific variables considered in the study such as profit margin, asset utilization, net interest margin, overhead efficiency, and numbers of branches have a positive and statistically significant effect on the financial performance of commercial banks. Contrarily, the equity multiplier ratio has a negative and significant effect on the financial performance of commercial banks

The Impact of Digital Transformation on Performance: Evidence from Vietnamese Commercial Banks

The role of digital transformation in creating value for commercial banks has been interesting to researchers for a long time. While many commercial banks have significantly investigated digital transformation, researchers and managers have still met many difficulties examining the distribution of digital transformation to business performance. This paper aims to evaluate the impact of digital transformation on Vietnamese commercial banks’ performance by different sizes, from there proposing policy implications of digital transformation to improve the banking performance. To achieve this goal, we used a quantitative research method. Specifically, we applied the GMM system (SGMM) of Blundell and Bond for the data of 13 joint-stock commercial banks in Vietnam in the period from 2011 to 2019. Then Bayesian analysis is performed to test the robustness of the models estimated by the SGMM method. The result shows that the digital transformation has a positive impact on the performance of Vietnamese commercial banks. Besides, we also find that the larger the banks, the greater the positive impact of digital transformation on bank performance. Therefore, the efficiency of digital transformation depends on a bank scale.

Effect of Credit Risk Management on Financial Performance Of Nepalese Commercial Banks

The main purpose of this study is to investigate the effect of credit risk on the financial performance of commercial banks in Nepal. The panel data of seventeen commercial banks with 85 observations for the period of 2015 to 2020 have been analyzed. The regression model revealed that non – performing loan (NPLR) has negative and statistically significant impact on financial performance (ROA).Capital adequacy ratio (CAR) and bank size (BS) have negative and statistically no significant impact on financial performance (ROA). Credit to deposit (CDR) has positive but no significant relationship with the financial performance (ROA) and the study concluded that the management quality ratio (MQR) has positive and significant relationship with the financial performance (ROA) of the commercial banks in Nepal. The study recommends that, it is fundamental for Nepalese commercial banks to practice scientific credit risk management, improve their efficacy in credit analysis and loan management to secure as much as possible their assets, and minimize the high incidence of non-performing loans and their negative effects on financial performance.

Cash Flow Ratios for Evaluating Performance in Nepalese Commercial Banks

The purpose of this paper is to examine and analyze the performance of Nepalese commercial banks through cash flow ratios. Descriptive as well as analytical research design has been used. All the government owned commercial banks has been taken as the sample of the study using judgmental technique. Sufficiency and efficiency ratios has been used for evaluating the performance of the concerned commercial banks. Data have been collected through the annual reports of respective banks covering for the financial year 2017/2018 to 2019/2020. All the banks are efficient to generate operating cash flow from sales and continued activities. However the cash generation from continued activities and asset utilization revealed sound in NBL and RBB than ADB in 2019/2020. Cash flow sufficiency revealed similar trends in all banks.

Evaluation of Effects of Credit-Risk on Return on Assets of Commercial Banks in Nepal

Introduction: The major cause of bank distress in Nepal is associated with poor credit management which results to decline in credit standing of the banks. The study adopts judgmental sampling techniques. Objective: To analyze and evaluate the impact of credit-risk ratio on return on assets of commercial banks in Nepal. Research design: Descriptive and exploratory research designs were used. Methods and materials: Review of various articles and collection of secondary data through the websites of Nepal Rastra Bank. Results and conclusion: It is found that there is inverse relationship between credit risk ratio and return on assets ratio. The findings provide sufficient evidence that credit risk management indicators impact significantly on commercial bank performance in Nepal. Article type: Research Paper