Credit risk management and effectiveness of credit activities: Evidence from Vietnam
DOI:
https://doi.org/10.15549/jeecar.v10i5.989Keywords:
credit risk management, loan performance, stated-owned bank, VietnamAbstract
The research aims to assess the effects of credit risk management on the effectiveness of credit activities at Vietnamese state-owned commercial banks. Based on the literature review and empirical studies, the aspects of credit risk management practices include four factors proposed in the research model, such as: credit terms, client appraisal, credit risk control, and collection policies. The author implements the descriptive statistical method and linear regression model on SPSS with data from a survey of credit officers from state-owned commercial banks in Vietnam. The findings show that credit term, client appraisal, and credit risk control positively influence loan performance at a 95% confidence interval. The paper also highlights the role of internal control as the mechanism for reducing credit risk and improving the effectiveness of credit activities.
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