| Abstract: | The purpose of the study was to assess the credit management practice of Lion International S.C. The data were gathered from all staff of the head office Credit Management Department and twenty branch managers and customers’ relationship officer found in Addis Ababa only on the credit management practices of the bank in areas of securing credit facilities against collateral, credit management analysis/evaluation practice of the bank, concentration risk management practice of the bank and the practice of the bank’s credit follow-up and recovery. The questionnaire survey was undertaken among 65 employees of the bank and all were collected to assess the perception of credit management practices of the bank in relation to the above practices. Closed ended questions were used, particularly to reflect the views of the employees with regard to four practices. Descriptive research design with 5 levels Likert scale was used to measure variables of study. Data was analyzed through descriptive statistics, percentage and frequency using SPSS Version 20.0 software. The result from the survey shows that majority of the bank staff were explained their concern on weak collateral coverage of the bank loans, high concentration risk on export loan out of the total loan volume of the bank, weak credit analysis during approval and at same time poor follow-up and recovery activities. According to the survey the bank can reverse the potential risk by providing reasonable attention for collateral holding , developing moderate loan concentration between credit products, improving the competency of the credit follow-up and recovery division for quality loan management and timely follow-up of bad debts were recommended. |
