EXPLORING THE CREDIT MANAGEMENT PRACTICE OF BUNNA INTERNATIONAL BANK S.C

Abstract

The study assessed credit management practices of Bunna International Bank S.C (BIB). The research was carried out by analyzing the process of accessing credits; credits control processes and credits collection strategies. The research was done against the background that there was huge debts as a result of nonperforming loans affecting the financial status of the bank. The descriptive survey method was used for the study. Sample size of 40 members of staff was drawn from the thirty three branches and Credit Department staff. Primary and secondary sources of data were used for the study. Questionnaires were used as the main instrument to collect the primary data on access to credit, credit control processes and credit collection strategies. Among the major findings of the study are; the main factors influencing access to credit are the stringent policy guidelines as well as the credit worthiness of the customers. A major credit control process was the process of ensuring compliance of internal guidelines. A major recommendation of the study was the need to adopt flexible policy which can improve access to credit. Besides, implementing the policies and guidelines that are set in place are mandatory. The overall credit management activity of the bank is poor and needs improvement in devising a strong follow-up unit, devising an office that can control the condition and sanctions at each approval document, establishing coordination among work units.