FIN725 Assignment 1 Solution and Discussion

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 SEMESTER FALL 2019

CREDIT AND RISK MANAGEMENT (FIN725)
ASSIGNMENT NO.01
DUE DATE: JANUARY 24, 2020 MARKS: 10
Learning Objectives:
The objective of this assignment is to enable the students in critically reading, reviewing, summarizing, and understanding the research articles so that they may be able to write their own articles in future.
Requirements:
Read carefully the attached research article and evaluate/summarize this article in your own words keeping in view the following points:

1. The background the research.

2. Your understanding about research including the main idea of the
   research.

3. The research question.

4. Objectives and significance of the research

5. The hypothesis proposed and tested.

6. Population and sample used.

7. Data collection techniques used in this research.

8. Statistical tools used in this research.

9. Conclusion of the research.

10. Any gap/limitation you feel for future research.
    You are not supposed to summarize this article in bullet form or provide short answers to the above mentioned points. Instead you are required to critically review this article by providing your own understanding in the form of summarized article (Maximum 2000 words).
    NOTE: You have to use your own word while writing this assignment. Copied material will be marked as ZERO.

    IMPORTANT:
    24 hours extra / grace period after the due date is usually available to overcome uploading difficulties. This extra time should only be used to meet the emergencies and above mentioned due dates should always be treated as final to avoid any inconvenience.
    IMPORTANT INSTRUCTIONS/ SOLUTION GUIDELINES/ SPECIAL INSTRUCTIONS
    OTHER IMPORTANT INSTRUCTIONS: DEADLINE:
     Make sure to upload the solution file before the due date on VULMS.
     Any submission made via email after the due date will not be accepted. FORMATTING GUIDELINES:
     Use the font style “Times New Roman” or “Arial” and font size “12”.
     It is advised to compose your document in MS-Word format.
     You may also compose your assignment in Open Office format.
     Use black and blue font colors only.
    REFERENCING GUIDELINES:
     Use APA style for referencing and citation. For guidance search “APA reference style” in Google and read various websites containing information for better understanding or visit http://linguistics.byu.edu/faculty/henrichsenl/apa/APA01.html

    RULES FOR MARKING
    Please note that your assignment will not be graded or graded as Zero (0), if:
     It is submitted after the due date.
     The file you uploaded does not open or is corrupt.
     It is in any format other than MS-Word or Open Office; e.g. Excel, PowerPoint, PDF etc.
     It is cheated or copied from other students, internet, books, journals etc.
    Note related to load shedding: Please be proactive
    Dear students!
    As you know that Post Mid-Term semester activities have started and load shedding problem is also prevailing in our country. Keeping in view the fact, you all are advised to post your activities as early as possible without waiting for the due date. For your convenience; activity schedule has already been uploaded on VULMS for the current semester, therefore no excuse will be entertained after due date of assignments, quizzes or GDBs.

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FIN725 Assignment 1 Solution and Discussion

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Impact of Credit Risk Management on Banks Performance: A Case Study in Pakistan Banks

Syed Muhammad Hamza
Banking and finance department, GC university Faisalabad
Abstract
This study captured the impact of credit risk management on performance of commercial banks in Pakistan. A fundamental research proposal was accepted in this study, and this was facilitated by the use of secondary data which was obtained from the SBP publications on banking sector survey, official websites and KSE. The pooled regression has been adopted to determine the impact of credit risk management on two performance methods. The findings revealed the fact that credit risk management is inversely associated with bank performance. For return on asset (ROA) analysis revealed that capital adequacy ratio (CAR), Loan loss provision ratio (LLPR), liquidity ratio (LR) and Non-performing loan ratio (NPLR) variables have significant impact on return on assets (ROA). The Loan loss provision ratio (LLPR), liquidity ratio (LR) and Non-performing loan ratio (NPLR) have negative while the capital adequacy ratio (CAR), loan and advances (LAR), and SIZE have positive impact on the return on assets.In relation to return on equity , the CAR, LAR and LLPR variables have significant impact on ROE. In this model the LLPR, NPLR and LR variables have negative and CAR, LAR and SIZE variables have positive impact on the dependent variable.
Keywords: credit risk management, financial performance, commercial banks.

Impact of Credit Risk Management on Banks Performance.pdf