LOAN GRANTING AND ITS RECOVERY PROBLEMS ON COMMERCIAL BANKS

(A CASE STUDY OF FIRST BANK PLC, OJO-ALABA BRANCH)

 

 

Click here to download our android mobile app to your phone  for more materials and others

COMPLETE PROJECT  MATERIAL COST 2500 NAIRA OR $10 , WITH THE SOFTWARE 30,000 NAIRA

. A FRESH TOPIC NOT LISTED ON OUR WEBSITE COST 50,000 NAIRA ( UNDERGRADUATE) OR 100,000 FOR SECOND DEGREE STUDENTS. $500. PLUS  FREE SUPPORT UNTIL YOU FINISH YOUR PROJECT WORK. CONTACT US TODAY, WE MAKE A DIFFERENT. DESIGN AND WRITING IS OUR SKILLED.  DESIGN AND WRITING IS OUR SKILLED.

Note: our case study can be change to suit your desire location . we are here for your success.

                                   ORDER NOW

Foreign Transaction For Dollars Payment :
Bank Name: GTBank
Branch Location: Enugu State,Nigeria.
Account Name: Chi E-Concept Int’l
 Account Number:  0117780667. 
Swift Code: GTBINGLA 
Dollar conversion rate for Naira is 175 per dollar. 

Note:  We accept bank transfer, ATM cash transfer , Online payment using your ATM , Western union bank transfer.  We will respond to you anytime of the day. 

OR
PAY ONLINE USING YOUR ATM CARD. IT IS SECURED AND RELIABLE.

form>DELIVERY PERIOD FOR BANK PAYMENT IS  LESS THAN 24 HOURS

CALL OKEKE CHIDI C ON :  08074466939,08063386834.

AFTER PAYMENT SEND YOUR PAYMENT DETAILS TO

08074466939 or 08063386834, YOUR PROJECT TITLE  YOU WANT US TO SEND TO YOU, AMOUNT PAID, DEPOSITOR NAME, UR EMAIL ADDRESS,PAYMENT DATE. YOU WILL RECEIVE YOUR MATERIAL IN LESS THAN 2 HOURS ONCE WILL CONFIRM YOUR PAYMENT.

WE HAVE SECURITY IN OUR BUSINESS.   

MONEY BACK GUARANTEE

ABSTRACT

 

This research work was undertaken to assess the Loan granting and its recovery problems on Commercial Banks. The research was intended to achieve the following objectives: To find out the several problems facing loan recovery, the effects of loan default on commercial banks and the measures that will be used in reducing the incidence of loan default. Relevant data were collected from both primary and secondary sources. Questionnaires were the main primary data collection instrument employed while data from various relevant publication constituted the sources of secondary data. Upon the analysis of data, the following conclusions were drawn: That problem of loan default stemmed from the fact that there is unavailability of security to be

 

disposed by banks to realize funds. And al loan payment. On the basis of the above findings, it was recommended that commercial banks should use some risk control measures to guide against

 

loan default. Also, before granting loan, they should examine critically the project statement submitted by the customer or borrower which will help them to find out the realistic repayment pattern and also help them in knowing if

the          projects  are  realistic  based  on  the  cus

 

Central Bank of Nigeria should create a conducive environment for the successfully operation of commercial banks in Nigeria.

 

	8
	TABLE OF CONTENTS
Title page——————————————————————————–	ii
Approval page————————————————————————–	iii
Certification—————————————————————————-	iv
Dedication——————————————————————————-	v
Acknowledgment———————————————————————–	vi
Table of contents——————————————————————-	vii-ix
Abstract———————————————————————————-	x

 

 

CHAPTER ONE

 

• Background of the study

 

1

 

• Statement of problems—————————————————————–

 

3

 

• Objectives of the study—————————————————————–

 

4

 

• Research question———————————————————————-

 

4

 

• Research hypothesis——————————————————————–

 

5

 

• Scope of the study———————————————————————-

₅ —————————————————————

 

9

 

• Significance of the Study 6

 

• Definition of terms———————————————————————-

 

6

 

• Limitations of the study—————————————————————-

₇ ————————————————————-

 

 

 

 

 

 

 

CHAPTER TWO

 

LITERATURE REVIEW

 

2.1   Brief introduction——————————————————————— 8

 

2.2    The nature of loan and advances granted by banks—————————–9

 

2.3   Problems of loan default————————————————————-13

 

2.4    Causes of loan default—————————————————————14

 

2.5   Effects of loan default—————————————————————-19

 

 

 

 

 

 

 

 

 

 

 

 

CHAPTER THREE

 

RESEARCH METHODOLOGY

 

10

 

3.1   Research design——————————————————————— 21

 

3.2       Definition Population ————————————————————–21

 

3.3       Sample size————————————————————————–21

 

3.4       Sources and method of data collection——————————————22

 

 

 

 

3.5       Method of data presentation and analysis————————————–26

 

 

CHAPTER FOUR

 

4.0   Data presentation and analysis—————————————————23

 

4.1   Presentation and interpretation of data——————————————23

 

4.2        Data analysis and findings——————————————————–31

 

4.3       Discussion of the findings———————————————————32

 

4.4       Recovery measures——————————————————————33

 

CHAPTER FIVE

 

SUMMARY OF FINDINGS, RECOMMENDATIONS AND CONCLUSION

 

5.1   Summary of findings—————————————————————- 39

 

5.2   Recommendation———————————————————————40

 

5.3   Conclusion—————————————————————————–41

 

5.4   Suggestion for further research—————————————————-42

 

Bibliography ————————————————————————–43

 

Appendix A—————————————————————————-45

 

Appendix B———————————————————————–46-48

 

11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHAPTER ONE

 

 

 

 

• BACKGROUND OF THE STUDY:

 

Virtually, every business has a credit relationship with a financial institution, especially banks. Some rely on periodic short term loans to finance temporary working capital needs. Others primarily use long-term loans to finance capital expenditure, new acquisitions or permanent increases in capital. Regardless of the type of loan, all credit request

 

mandate a systematic analysis of the borrow due.

 

 

 

Commercial banks carry on ordinary banking business with the general public, changing cash for bank deposits and bank deposits for cash,

 

12 transferring bank deposit from one corporation to another, giving bank

 

deposit in exchange of bills of exchange, providing of trustees and executo services, providing safe custody of funds and valuables as well as foreign

 

exchange remittance.

 

Though commercial banks differs from country to country, their profit and banking motives are the same. Their activities are of interest to their customers, workers (staff), and above all, shareholders. The commercial objective of the bank is to maximize profit, though other social and economic functions tends to deflect banks from profit maximization.

 

The aims and objectives of commercial banks have therefore paved way for their customers to make and obtain credits, in form of loan of which the researcher is interested in.

 

Lending has become a vital function on operation because of its direct effect and impact on economic growth and business development.

 

In a market oriented economy, there are two main participants that move the economic growth; these are the suppliers of invisible funds and the users of the funds for productive purposes. These two participants are spread widely in the economy and may not have direct relationship with each other. For this, there is the need to have an intermediary to link them up. The banking sector mobilize surplus funds from small and big savers who have no immediate need for such funds. The users of these funds are

 

13

 

the business entrepreneurs and investors who have brilliant ideas on how to create additional wealth in the economy but lack the necessary capital to execute their ideas. These groups of people approach banks to obtain loan.

 

Subsequently, lending is a risky venture which banks only engage on after a rigorous and satisfactory analysis of the project for which lending is being made. The main preoccupation of banks is extending loans to their customers. Thus, the formulation and implementation of such lending policies are some of the important responsibilities of the management of the bank. The lending policy of a bank must be specific on how much loan will be made available to whom, what period and for what reason. For this reason, lending policies should be well documented so that lending officers will be able to know the areas of prohibition and the area of where they can operate. Also, such policies should be subjected to periodic review to make the banks keep abreast with the dynamic and innovation nature of the economy as well as competing with other changing economic sector.

 

Therefore, the basic objectives of credit analysis t=is to assess the risks involved in extending loans to bank customers. In financial circle, risk typically refers to the volatility in earnings. Lenders are particularly concerned with adverse fluctuation in net income or cash flows, which

 

hinder                 the  borrower‟s  ability  to  service  a

 

with historical and projected financial data, while others such as those

 

14

 

associated                         with  borrower‟s  character  and  wi

 

directly measurable.

 

• STATEMENT OF PROBLEMS:

 

Banks in recent times has failed as a result of loan recovery problems. Loan is the major source of bank profitability.

 

However, in going about their lending activities, banks have their own objectives among which are profitability, growth, safety, suitability and liquidity.

 

Loan, when not recovered could adversely affect banks. It is easily granted than recovered. It usually needs proficiency i.e. competency and expertise in the recovery process. It sometimes become an uphill task to recover. When they are not recovered, the impact is often disastrous to the bank. It can lead