Abstract: Any banking institution main goal is to operate profitably in order to maintain stability and sustainable growth. Both external and internal economic environments are viewed as critical drivers for bank performance. The main purpose of this study was to determine the effects of loan portfolio management on the financial performance of commercial banks in Rwanda for a period of 3 years, starting from the year 2014 to 2016. The study was guided by the following objectives; to determine the effects of loan risk analysis on the financial performance of commercial banks in Rwanda, to determine the impact of risk monitoring on the financial performance of commercial banks in Rwanda and to evaluate the effects of loan risk diversification on the financial performance of commercial banks in Rwanda. Firm performance was measured using Return on Equity (ROE). This study adopted a descriptive research design in soliciting information on effects of liquidity management on financial performance of commercial banks. Stratified random sampling was used to determine the sample size. The study targeted BPR management and employees totaling to 110 respondents, the sample size was 87 respondents. The study used both primary and secondary data, where questionnaires, interview and annual reports of BPR was used. Primary quantitative data was collected by use of self-administered structured questionnaires. The researcher also used secondary data derived from the audited financial statement of the commercial banks for the period 2014 to 2016. The data collected was analyzed, with respect to the study objectives, using both descriptive and inferential statistics. The data was analyzed using descriptive statistics such as mode, median, mean, standard deviation. Multiple regression analysis was employed to determine relationship between loan portfolio management and financial performance of commercial banks in Rwanda. Data was presented in tables, charts, figures and mathematical expressions.
Keywords: Portfolio, Loan, Management, Portfolio Management, Financial performance, Loan risk analysis, Loan risk diversification and Loan risk monitoring.
Title: EFFECTS OF LOAN PORTFOLIO MANAGEMENT ON FINANCIAL PERFORMANCE OF COMMERCIAL BANKS IN RWANDA: A CASE OF BANQUE POPULAIRE du RWANDA
Author: Liliane MWIZERWA, Dr. Patrick MULYUNGI, Dr. Jaya SHUKLA
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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