Abstract: Non-Performing loans are one of the key causes of banks breakdown in Kenya commercial banks. The following study sought to deeply investigate on determinants of nonperforming loans and thereafter come up with recommendations in regard to nonperforming loans problem. The general objective of the study was to assess the determinants of loan nonperformance in Kenya commercial banks. The study was guided by the following specific objectives: To determine the effect of Bank Ownership structure on loans nonperformance in Kenya commercial banks and to determine the effect of Credit Monitoring on loans nonperformance in Kenya commercial banks. The study employed descriptive research design where quantitative approach was applied. Census was adopted where data was obtained from 43 commercial banks in Kenya and analyzed using SPSS version 23 by applying both correlation and regression to show relationship between the variables. The results showed that both Bank ownership structure and credit monitoring were statistically significant in relation to Non performing loans. The study recommended that the bank management should take key issues on asset quality of the bank specifically loan performance for prevention of nonperforming loan thus can give due emphasis on the asset management decision then manage them efficiently. Management should also put into consideration the process and procedures in regard to credit monitoring. The internal risk management process must be sophisticated, proactive and adaptable handled by risk management staff and external partners, who can effectively and routinely assess, quantify, prioritize and address Non performing loans in depth.
Keywords: Bank Ownership Structure, Credit Monitoring, Non performing Loans.
Title: Determinants of Loan Non Performance in Kenya Commercial Banks
Author: Edah Kavwanyiri
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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