The Influences of Credit Risk Management on Financial Performance of Commercial Banks in Kenya
Abstract
Credit management stands out as a crucial exercise in businesses and cannot be ignored
by any monetary venture occupied with credit regardless of its inclination of business.
Sound credit management is an essential part of a budgetary foundation's soundness and
continuing profitability.Commercial Banks are in the business of lending money. This is
their main source of income. Credit management is therefore critical to them without
which they would lose their principal too in addition to the lost income. In the recent past,
we have seen banks collapse due to poor and weak credit management policies. For
instance we have seen Chase Bank come into the lime light because of its inability to
honour its obligations-this is all about liquidity emanating from poor management and
weak credit management policies. Imperial bank was also in the headlines for such like
reasons. Institutions therefore need to have proper credit risk management policies that
are working. But does this always translate into good performance in terms of increased
profitability? This study sought to discover the influences of credit risk management on
money related execution of recorded business banks in Kenya. It utilized a descriptive
research design. The population of study consisted of 43 commercial banks in Kenya. A
census study was used to carry out the research. Secondary data from financial statements
of commercial banks in Kenya was collected. The study collected secondary data for the
last five years starting year 2011 to 2015 from financial statements of the commercial
banks. Descriptive statistics were used to analyze data.
Publisher
University Of Nairobi
Rights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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