Please use this identifier to cite or link to this item: http://hdl.handle.net/20.500.12306/14233
Title: Credit risk management and loan repayment of selected commercial banks in Mogadishu, Somalia
Authors: Ali, Muse
Mohamed
Keywords: Credit risk
Management
Loan repayment
Mogadishu, Somalia
Issue Date: Nov-2021
Publisher: Kampala International University, College of Economics and management
Abstract: ABSTRACT The study sought to assess the effect of credit risk management on loan repayment of commercial Banks in Mogadishu Somalia. It was guided by three specific objectives that included; determining the effect of credit terms on loan repayment of commercial Banks in Mogadishu Somalia, to establish the effect of client appraisal on loan repayment of commercial Banks in Mogadishu Somalia and to establish the effect of credit risk control on loan repayment of commercial Banks in Mogadishu Somalia. This research employed a descriptive research design to describe the variables, the study used a population of 140 and a sample size of 104, the questionnaire and interview guide were used as the research instruments. Descriptive statistics used in this study included frequencies, means and regression analysis on variables. The findings revealed the following: the findings indicated that credit terms significantly affects the performance of Banks in Mogadishu Somalia, this effect therefore implies that credit terms highly contribute to the Performance of Banks in Mogadishu Somalia, the findings revealed that there is a significant effect client appraisal has on loan repayment of commercial Banks in Mogadishu Somalia, findings of this study proved a weak positive significant effect credit risk control has on loan repayment of commercial Banks in Mogadishu Somalia. Still the conclusions were that; credit terms has a strong positive significant effect on loan repayment of commercial Banks in Mogadishu Somalia, client appraisal has a significant effect on loan repayment of commercial Banks in Mogadishu Somalia. Effective risk management requires a reporting and review structure to ensure that risks are effectively identified and assessed and that appropriate controls and responses are in place. The planned risk responses which are integrated into the project management plan by the process integrated change control are therefore executed if the risk triggers fire. Credit risk control should involve screening clients to ensure that they have the willingness and ability to repay a loan. The researcher recommended that: the banks in Mogadishu Somalia should develop a good system to monitor, record and track all the risks so that there is effectiveness in credit risk management and ensure to cover loopholes in the system to enhance Performance of Banks. The bank managers in Mogadishu should develop an effective client appraisal system which makes client appraisal easy and flexible so as to boost loan repayment in commercial Banks. Contribution to knowledge was; credit risk management being an important aspect for any organization still lag behind in Mogadishu Somalia’s banking sector given that most employees in the country stay in the prevalence of an environment supported by mixed managerial capabilities with limited regulations especially for the credit. Credit risk management is an important predictor of bank’s financial performance because the bank’s success depends on credit risk management.
Description: Thesis report presented to the College of Higher Degrees and Research Uganda in partial fulfillment of the requirements for the Degree of Master of Business Administration (accounting option), Kampala International University,
URI: http://hdl.handle.net/20.500.12306/14233
Appears in Collections:Master of Business Administration - Main and Ishaka Campus

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