dc.contributor.author | Kimeu, Titus K | |
dc.date.accessioned | 2013-05-15T12:42:15Z | |
dc.date.available | 2013-05-15T12:42:15Z | |
dc.date.issued | 2008-10 | |
dc.identifier.uri | http://erepository.uonbi.ac.ke:8080/xmlui/handle/123456789/23233 | |
dc.description.abstract | Banks operate in an environment of considerable risks and uncertainty. Credit risk is one
of the major risks Commercial Banks face today. The objective of the study was to assess
the credit risk management techniques adopted by Commercial Banks in Kenya to assess
un- secured bank loans.
The population of the study consisted of 47 Commercial Banks and a census study was
adopted. Data was collected from primary sources through a semi-structured
questionnaire, administered to the Credit Officers of the various Commercial Banks. The
results were analyzed and presented in the form of frequency tables and percentages.
The findings reveal that a majority of the Commercial Banks in Kenya are involved in
un-secured loan services. Most of the Commercial Banks had both minimum and
maximum loan limits. It was also found that all the Commercial Banks have credit
management policies as a basis for objective credit risk appraisal. Formulation of unsecured
loan policies was undertaken by their Top Management. Majority of the
Commercial Banks have distinctive separate departments where un-secured loans
activities are organized. From the study it was revealed that Statistical Method of credit
assessment is the mostly used in assessing/screening loan applications. A majority of the
Commercial Banks maintained a certain Debt Ratio. Quality appraisal of loan portfolios
was found to be the mostly considered measure able to improve loan serviceability/
reduce credit risk. Irregular credit turnover/ salary and declining turnover/ salary are the
trends greatly affecting customers' credit worthiness. A loanee is considered a defaulter
after three late repayments in most of the Commercial Banks.
Further, the study established that Credit risk and Liquidity risk are the most important
risks for Commercial Banks. Improved credit appraisals is the most considered factor
responsible for banks improved financial performance. Capacity and Character of the
borrower are the most considered of the 6 Cs when appraising customers credit
worthiness. | en |
dc.description.sponsorship | University of Nairobi | en |
dc.language.iso | en | en |
dc.subject | Credit risk management | en |
dc.subject | Un-secured bank loans | en |
dc.subject | Commercial banks | en |
dc.subject | Kenya | en |
dc.title | A survey of credit risk management techniques of unsecured bank loans of commercial banks in Kenya | en |
dc.type | Thesis | en |
local.publisher | School of Business, University of Nairobi | en |