Examining the effectiveness of credit risk management on banks: the case of FBC bank
- Author
- Jaravaza, Tafadzwa
- Title
- Examining the effectiveness of credit risk management on banks: the case of FBC bank
- Abstract
-
Financial institutions are crucial for economic growth, but Zimbabwe's harsh economic environment since the 2008 recession has exposed them to various risks, particularly credit risk. This study assessed credit risk management practices at FBC Bank. It aimed to identify the main sources of credit risk, evaluate the bank's current techniques for mitigating risk, and recommend strategies for improvement.
The research used a case study design with stratified random sampling. Data was collected through questionnaires (67 respondents) and interviews (13 respondents). The study identified macro-economic instability, non-performing loans, and non-compliance with credit risk policies as the primary sources of credit risk for FBC Bank. Additionally, it found that the bank lacks loan protection insurance, further exposing them to risk, especially for clients.
Based on the literature review and findings, the study recommends several improvements which include regular review of credit risk policies by the board to ensure alignment with current risk tolerance levels, hiring external credit risk analysts to implement advanced evaluation models and ongoing training programs for bank employees on effective credit risk management practices
- Date
- MAY 2024
- Publisher
- BUSE
- Keywords
- Risk management, FBC
- Supervisor
- Mr. Chaparadza
- Item sets
- Department of Banking and Finance
- Media
-
TAFADZWA JARAVAZA.pdf
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