RISK MANAGEMENT PRACTICE IN THE CASE OF COMMERCIAL BANK OF ETHIOPIA

Abstract

The purpose of this study was assessing the risk management practice including financial and non-financial risks in the case of commercial bank of Ethiopia. The financial risks are credit, liquidity, Market and the non-financial risks are operational, Strategic, reputational risk. In doing this descriptive research design, qualitative research approach was used. Data were collected from 26 risk department employees, 23 strategic department employees, 15 communication department employees, 20 marketing department employees. The study relied on primary and secondary data. The primary data collected using questionnaires. The secondary data collected from NBE guidelines and internets, Data analyzed with descriptive statistics such as frequencies, Percentage, mean and standard deviation through statistical tool SPSS version 20. The data presented in tables. The study found out that the average mean of all variables are above the mid-point this indicates that the credit, market, liquidity, operational, strategic and reputational risk management practice of commercial bank of Ethiopia is at good stage. The study recommends that the bank or the responsible person think about money market and capital market in addition to deposit or remittance collection for contingency issue, the bank should ensure good work place environment and employees satisfaction to minimize reputational risk, the strategic and reputational risks are highly affect the banks industry so it will be better the bank consider as a risk type and set rules and regulations.