The Influence of Credit Risk Management


The study was to establish the influence of credit risk management and loan portfolio performance of commercial Banks in South Sudan, using the case of Equity Bank, Muniki Branch Juba. The study’sobjectives were to establish the influence of credit risk identification,credit risk monitoring and credit risk control strategies on loan portfolio performance at Equity Bank Juba, Muniki Branch.The study adopted across-sectional research design from a cohort of 32 employees in Equity bank to collect data using both qualitative and quantitative research data collection techniques. The data revealed that credit risk identification was positively related to loan portfolio performance, given r=0.483 at significance relationship level of 0.007<0.01. It was also revealed that credit risk monitoring at Equity Bank was positively related to loan portfolio performance, given r= 0.773 at P= 0.000 significance level. Furthermore, at Equity Bank, credit risk control was also positively related to loan portfolio performance becauser= 0.623 at P= 0.000 significance level.

The study concluded that all the three elements — credit risk identification, credit risk monitoring and credit risk control strategies — positively affect performance of loan portfolios at Equity Bank Juba, Munika Branch in line with Diamond’s (2009) postulation. Therefore, the study recommends that there is need for Equity Bank managers to place emphasis on credit risk identification, monitoring and control in order to ensure positive performance of their loan portfolio.
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