The Impact of Credit Risk Management on the Profitability of a Commercial Bank: The Case of BGFI Bank Congo

Ossou Ndzila Fred Nelson

International Journal of Economics and Finance, 2020, vol. 12, issue 3, 21

Abstract: This study examines the impact of credit risk management on the profitability of BGFI Bank Congo, by identifying credit risk indicators and profitability measurement ratios over the period of 2010-2019. The results indicate that profitability is somewhat affected by credit risk management as measured by its credit risk management indicators. The non-performing loan ratio (NPLR), the capital assets ratio (CAR), and the loan loss provision ratio (LLPR) show a negative impact on ROE. These three ratios contribute negatively, while the CAR makes a positive contribution to Return on assets (ROA) and the ratio of client loans and short-term financing (RCLSTF) on return on equity (ROE). Thus, credit risk management has a significant impact on profitability. The study also shows that other selected credit risk management indicators have a significant impact on the Bank's profitability, such as the loan provision ratio (LLPR) and the clean capital adequacy ratio.

Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.ccsenet.org/journal/index.php/ijef/article/download/0/0/42090/43791 (application/pdf)
http://www.ccsenet.org/journal/index.php/ijef/article/view/0/42090 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ibn:ijefaa:v:12:y:2020:i:3:p:21

Access Statistics for this article

More articles in International Journal of Economics and Finance from Canadian Center of Science and Education Contact information at EDIRC.
Bibliographic data for series maintained by Canadian Center of Science and Education ().