Collection Title:	SIU IS
Title :	Credit Risk and Its Impact on Bank Performance: A Study from Nepalese Commercial Bank
Material Type:	printed text
Authors:	Rup Narayan Jha, Author ; Virachai Vongbunsin, Associated Name ; Niranjan Phuyal, Associated Name
Publisher:	Bangkok: Shinawatra University
Publication Date:	2017
Pagination:	ix, 60 p.
Layout:	ill, Tables
Size:	30 cm.
Price:	500.00
General note:	SIU IS: SOM-MBA-2017-N28 IS [MS. [MBA]] -- Shinawatra University, 2017
Languages :	English (eng)
Descriptors:	[LCSH]Banks and banking -- Nepal [LCSH]Performance
Keywords:	Bank, Credit, Nepalese, Performance, Regression, Risk
Abstract:	Commercial banks are exposed to high risk loans. The higher is the accumulation of unpaid loans implying that these loan losses have produced lower returns to many commercial banks. Basel Committee on Banking Supervision (1999) asserts that loans are the largest and most obvious source of credit risk, while other are found on the various activities that the bank involved itself with. The indicators to measure the credit risk management: capital adequacy ratio (CAR) and non-performing loans ratio (NPLR), which are the main indicators used to assess the soundness of the banking system (Bhawani and Bhanumurthy, 2012). Likely, Kurawa and Garba (2014) have pointed out the credit risk management (CRM) indicators such as: non-performing loan ratio rate (NPLR), cost per loan assets (CLA), and capital adequacy ratio (CAR) which influence banks' profitability (ROA). However, every bank needs to identify measure, monitor and control credit risk and also determining how credit risks could be lowered. This means that a bank should hold adequate capital, control the non-performing loan and maintain the appropriate cost per loan assets. The main aim of this study is to evaluate the relationship between credit risk management and bank performance. The expectancy is good credit risk management would lead to better performance and vice versa, while bad credit management would lead to poor and bad performance and vice versa. The specific objectives of this study are as follows (a) To explain how Credit risk impact on Bank performance. (b)To determine the impact of non-performing loans, capital adequacy ratio, cost per loan assets, cash reserve ratio and bank size on Bank performance of the Nepalese commercial banks. (c) To identify the factors influencing Bank performance in commercial banks of Nepal. (d) To analyze the structure and pattern of credit management variables and Bank performance of Nepalese commercial banks. This study has examined the effect of credit risk on performance of Nepalese commercial banks. The descriptive and causal comparative research designs have been adopted for the study. The pooled data of 14 commercial banks for the period 2008 to 2015 have been analyzed using regression model. The regression results revealed that 'nonperforming loan ratio' has negative effect on bank performance whereas 'cost per loan assets' has positive effect on bank performance. In addition to credit risk indicators, bank size has positive effect on bank performance. Capital adequacy ratio and cash reserve are not considered as the influencing variables on bank performance. This study concludes that there is significant relationship between bank performance and credit risk indicators. The major conclusion of the study has found the significant relationship between bank performance and credit risk indicators. The study concludes that 'non-performing loan ratio' has negative effect on bank performance whereas 'cost per loan assets' has positive effect on bank performance. The positive coefficient of cost per loan assets indicates the bank's efficiency in distributing loans to customers and collecting higher level of interest revenue as compare to interest expense and other operating costs. Cost per loan assets is considered to be the influencing variable to enhance banks' performance. In addition to credit risk indicators, bank performance is also affected by its size. As a whole, Nepalese commercial banks have poor credit risk management. Thus, these banks need to follow prudent credit risk management and safeguarding the assets of the banks and protect the interests of the stakeholders.
Curricular :	BBA/MBA
Record link:	http://libsearch.siu.ac.th/siu/opac_css/index.php?lvl=notice_display&id=27411

SIU IS. Credit Risk and Its Impact on Bank Performance: A Study from Nepalese Commercial Bank [printed text] / Rup Narayan Jha, Author ; Virachai Vongbunsin, Associated Name ; Niranjan Phuyal, Associated Name . - [S.l.] : Bangkok: Shinawatra University, 2017 . - ix, 60 p. : ill, Tables ; 30 cm.
500.00
SIU IS: SOM-MBA-2017-N28
IS [MS. [MBA]] -- Shinawatra University, 2017
Languages : English (eng)

Descriptors:	[LCSH]Banks and banking -- Nepal [LCSH]Performance
Keywords:	Bank, Credit, Nepalese, Performance, Regression, Risk
Abstract:	Commercial banks are exposed to high risk loans. The higher is the accumulation of unpaid loans implying that these loan losses have produced lower returns to many commercial banks. Basel Committee on Banking Supervision (1999) asserts that loans are the largest and most obvious source of credit risk, while other are found on the various activities that the bank involved itself with. The indicators to measure the credit risk management: capital adequacy ratio (CAR) and non-performing loans ratio (NPLR), which are the main indicators used to assess the soundness of the banking system (Bhawani and Bhanumurthy, 2012). Likely, Kurawa and Garba (2014) have pointed out the credit risk management (CRM) indicators such as: non-performing loan ratio rate (NPLR), cost per loan assets (CLA), and capital adequacy ratio (CAR) which influence banks' profitability (ROA). However, every bank needs to identify measure, monitor and control credit risk and also determining how credit risks could be lowered. This means that a bank should hold adequate capital, control the non-performing loan and maintain the appropriate cost per loan assets. The main aim of this study is to evaluate the relationship between credit risk management and bank performance. The expectancy is good credit risk management would lead to better performance and vice versa, while bad credit management would lead to poor and bad performance and vice versa. The specific objectives of this study are as follows (a) To explain how Credit risk impact on Bank performance. (b)To determine the impact of non-performing loans, capital adequacy ratio, cost per loan assets, cash reserve ratio and bank size on Bank performance of the Nepalese commercial banks. (c) To identify the factors influencing Bank performance in commercial banks of Nepal. (d) To analyze the structure and pattern of credit management variables and Bank performance of Nepalese commercial banks. This study has examined the effect of credit risk on performance of Nepalese commercial banks. The descriptive and causal comparative research designs have been adopted for the study. The pooled data of 14 commercial banks for the period 2008 to 2015 have been analyzed using regression model. The regression results revealed that 'nonperforming loan ratio' has negative effect on bank performance whereas 'cost per loan assets' has positive effect on bank performance. In addition to credit risk indicators, bank size has positive effect on bank performance. Capital adequacy ratio and cash reserve are not considered as the influencing variables on bank performance. This study concludes that there is significant relationship between bank performance and credit risk indicators. The major conclusion of the study has found the significant relationship between bank performance and credit risk indicators. The study concludes that 'non-performing loan ratio' has negative effect on bank performance whereas 'cost per loan assets' has positive effect on bank performance. The positive coefficient of cost per loan assets indicates the bank's efficiency in distributing loans to customers and collecting higher level of interest revenue as compare to interest expense and other operating costs. Cost per loan assets is considered to be the influencing variable to enhance banks' performance. In addition to credit risk indicators, bank performance is also affected by its size. As a whole, Nepalese commercial banks have poor credit risk management. Thus, these banks need to follow prudent credit risk management and safeguarding the assets of the banks and protect the interests of the stakeholders.
Curricular :	BBA/MBA
Record link:	http://libsearch.siu.ac.th/siu/opac_css/index.php?lvl=notice_display&id=27411