CREDIT RISK MANAGEMENT AND PERFORMANCE OF COMMERCIAL BANKS
| dc.contributor.advisor | Rabindra Bhattarai | |
| dc.contributor.author | Pratiksha Magar | |
| dc.date.accessioned | 2025-04-28T09:05:31Z | |
| dc.date.available | 2025-04-28T09:05:31Z | |
| dc.date.issued | 2024 | |
| dc.description.abstract | Credit risk management plays a crucial role in ensuring the profitability and stability of commercial banks by mitigating potential financial losses arising from defaults and poor credit practices. This study focuses on examining the relationship between credit risk management practices and the profitability of Nepalese commercial banks. Specifically, it explores the impact of non-performing loan ratios (NPL), credit-to-deposit ratios (CDR), interest spread rates (IRS), and credit risk indicators on key profitability measures such as Return on Assets (ROA) and Return on Equity (ROE). A descriptive and causal-comparative research design was adopted for this study, utilizing secondary data sourced from the annual reports of the selected banks over a ten-year period. Statistical tools such as regression analysis, standard deviation, coefficient of variation, and comparative ratio analysis were employed to analyze the data and evaluate the relationships between credit risk management indicators and profitability measures. The findings reveal that effective credit risk management significantly enhances profitability, as evidenced by the lower NPL ratios and higher ROA and ROE of banks like NSBL. Conversely, banks with higher NPL ratios, such as HBL during specific periods, faced reduced profitability due to increased provisioning requirements and reduced income from interest-earning assets. Balanced CDRs and favorable interest spread rates were also found to positively influence profitability. The study concludes that sound credit risk management practices are pivotal for sustaining profitability and stability in the Nepalese banking sector, offering valuable insights for managers, policymakers, and future researchers. | |
| dc.identifier.uri | https://hdl.handle.net/20.500.14540/24940 | |
| dc.language.iso | en_US | |
| dc.publisher | Shanker Dev Campus | |
| dc.title | CREDIT RISK MANAGEMENT AND PERFORMANCE OF COMMERCIAL BANKS | |
| dc.type | Thesis | |
| local.academic.level | Masters | |
| local.affiliatedinstitute.title | Shanker Dev Campus | |
| local.institute.title | Faculty of Management |