Factors affecting risk taking behavior in Nepalese commercial banks / Subodh Adhikari 

Public ISBD Title : Factors affecting risk taking behavior in Nepalese commercial banks Material Type: printed text Authors: Subodh Adhikari, Author Pagination: 87p. Size: GRP/Thesis Accompanying material: 2/B General note: Including bibliography Languages : English Descriptors: Banks Commercial banks Nepal Risk taking behavior Keywords: 'risk behavior  banks  commercial banks  Nepal' Class number: 332.16 Abstract: Liquidity risk, credit risk, market risk, operational risk, interest rate risk etc have always been along with banks. But, since bearing risk is an integral part of banking business, it is not surprising that banks have been practicing risk management ever since there have been banks- the industry could not have survived without it. The only real change is the degree of sophistication now required to reflect the more complex and fast-paced environment. Thus, it is essential to identify the factors that affect risk taking of banks, so that risk management technique could be used more efficiently and effectively. This study attempts to identify the factors that affect the risk taking behavior of the commercial banks operating in Nepal. This study determines the factors affecting the risk taking behavior of selected commercial banks of Nepal. The specific objectives of this study were to analyze the relationship between credit risk and capital requirement, foreign investment, ex-NRB officers, loan growth rate, non performing loan, return on assets and log of total assets, to investigate the relationship between liquidity risk and capital requirement, foreign investment, ex- NRB officers, log of total assets, credit to deposit ratio, cash reserve ratio and bank lending rate, to examine the impact of capital requirement, foreign investment, ex-NRB officers, log of total assets, GDP, Inflation and net interest margin on market risk of the bank, to assess the employees views on bank risk taking behavior. The research was based on both the primary and secondary data with methods such as descriptive statistics and regression analysis for secondary data analysis and percentage frequency distribution and likert scale for primary data analysis. This study concludes that the presence of foreign investors and Ex-NRB officers seems to be affecting the level of risk taken by banks. It is also concluded that regulatory capital requirement also plays important role in determining the risk taken by banks. Besides, the study also concludes that nonperforming loan and return on assets explain the credit risk of the bank. This means the banks should focus these variables in order to maintain the credit risk of the bank. Similarly, capital requirement and credit to deposit ratio explain the liquidity risk of the bank. Likewise capital requirement, ex-off, bank size and inflation explain the market risk of the bank. Similarly in the case of primary study, the study concludes that rules and regulations formulated by central bank determine the level of risk taken by the bank. The rules and regulation regarding minimum cash reserve requirement, bank lending rate also affects the risk taking behavior of the bank. Similarly macroeconomic variables like GDP and inflation are equally important variables on bank risk taking. In case of Nepal interest rate is the most important factor for evaluation of market risk as other factors are not popular. Based on the findings and conclusion the study recommends that the regulatory authority should give importance in size of the banks. Similarly focus of banks should be on credit policies and guidelines, bank internal factors and formulation of appropriate rules and regulations to minimize the credit risk, operational risk and liquidity risk respectively. Factors affecting risk taking behavior in Nepalese commercial banks [printed text] / Subodh Adhikari, Author . - [s.d.] . - 87p. ; GRP/Thesis + 2/B. Including bibliography Languages : English Descriptors: Banks Commercial banks Nepal Risk taking behavior Keywords: 'risk behavior  banks  commercial banks  Nepal' Class number: 332.16 Abstract: Liquidity risk, credit risk, market risk, operational risk, interest rate risk etc have always been along with banks. But, since bearing risk is an integral part of banking business, it is not surprising that banks have been practicing risk management ever since there have been banks- the industry could not have survived without it. The only real change is the degree of sophistication now required to reflect the more complex and fast-paced environment. Thus, it is essential to identify the factors that affect risk taking of banks, so that risk management technique could be used more efficiently and effectively. This study attempts to identify the factors that affect the risk taking behavior of the commercial banks operating in Nepal. This study determines the factors affecting the risk taking behavior of selected commercial banks of Nepal. The specific objectives of this study were to analyze the relationship between credit risk and capital requirement, foreign investment, ex-NRB officers, loan growth rate, non performing loan, return on assets and log of total assets, to investigate the relationship between liquidity risk and capital requirement, foreign investment, ex- NRB officers, log of total assets, credit to deposit ratio, cash reserve ratio and bank lending rate, to examine the impact of capital requirement, foreign investment, ex-NRB officers, log of total assets, GDP, Inflation and net interest margin on market risk of the bank, to assess the employees views on bank risk taking behavior. The research was based on both the primary and secondary data with methods such as descriptive statistics and regression analysis for secondary data analysis and percentage frequency distribution and likert scale for primary data analysis. This study concludes that the presence of foreign investors and Ex-NRB officers seems to be affecting the level of risk taken by banks. It is also concluded that regulatory capital requirement also plays important role in determining the risk taken by banks. Besides, the study also concludes that nonperforming loan and return on assets explain the credit risk of the bank. This means the banks should focus these variables in order to maintain the credit risk of the bank. Similarly, capital requirement and credit to deposit ratio explain the liquidity risk of the bank. Likewise capital requirement, ex-off, bank size and inflation explain the market risk of the bank. Similarly in the case of primary study, the study concludes that rules and regulations formulated by central bank determine the level of risk taken by the bank. The rules and regulation regarding minimum cash reserve requirement, bank lending rate also affects the risk taking behavior of the bank. Similarly macroeconomic variables like GDP and inflation are equally important variables on bank risk taking. In case of Nepal interest rate is the most important factor for evaluation of market risk as other factors are not popular. Based on the findings and conclusion the study recommends that the regulatory authority should give importance in size of the banks. Similarly focus of banks should be on credit policies and guidelines, bank internal factors and formulation of appropriate rules and regulations to minimize the credit risk, operational risk and liquidity risk respectively.

Hold

Place a hold on this item

Copies

Barcode	Call number	Media type	Location	Section	Status
26/D	332.16 ADH	Thesis/Dissertation	Uniglobe Library	Social Sciences	Available

Risk taking behavior and performance evaluation of joint venture and non joint venture commercial banks of Nepal / Niroj Maharjan 

Public ISBD Title : Risk taking behavior and performance evaluation of joint venture and non joint venture commercial banks of Nepal Material Type: printed text Authors: Niroj Maharjan, Author Publication Date: 2014 Pagination: 114p. Size: GRP/Thesis Accompanying material: 2/B General note: Including bibliography Languages : English Descriptors: Banks Banks and banking Commercial banks Risk taking behavior Risk-taking (Psychology) Keywords: 'risk taking behavior  banks  banks and banking commercial bank  nepal' Class number: 155.9 Abstract: Despite of several empirical evidences, bank’s risk taking behavior and performance evaluation issues are still unsolved in the context of Nepal. Identification of banks’ risk taking behavior and factors shaping the performance of bank is crucial for the Nepalese commercial banks. The major objective of this study is to analyze the risk taking behavior and performance evaluation of Nepalese commercial banks. The review of literature has shown relationship between various factors such as growth of loan, investment, total assets, return on assets, gross domestic product, capital adequacy ratio and leverage. In addition, leverage, total assets, loan, investment and non-performing loan to total loan are some of the variables that are found to have significant relationship with risk taking behavior and performance of banks in various contexts. Based on the literature reviews, this study has proposed the conceptual framework identifying volume of loan, investment and return on assets and some of other variables as the most important factors that determine the risk taking behavior and performance evaluation of commercial banks in the context of Nepal. This study is based on primary as well as secondary data. For the purpose of study 19 commercial banks which are established before 2007/08 are divided into two strata (joint venture and non-joint venture) is taken as sample. Required data of dependent variables (loan, investment, and return on assets) and independent variables (leverage, deposit, non-performing loan to total loan, net interest margin, debenture and bond, total assets, capital adequacy ratio, gross domestic product and inflation rate.) are collected from various secondary sources for the period of 2007/08 to 20011/12. Primary survey questionnaire is conducted in order to assess the opinion of bank’s risk taking behavior and performance evaluation of Nepalese commercial banks. Likewise, multiple regression analysis and correlation analysis are used to examine the relationship between bank’s risk taking behavior and performance evaluation and its determinants. The study reveals that volume of debenture and bond, deposit and total assets are some of the variables that are found to have significant relationship with the risk taking behavior of joint venture banks in various contexts. Similarly, non-performing loan to total loan, leverage, total assets, inflation and net interest margin are some of the variables that are found to have significant relationship with the risk taking behavior of non-joint venture banks in various contexts. Net interest margin and total assets has significant relationship with performance evaluation in both joint and non-joint venture banks. Based on the study, total assets, non-performing loan tot total loan, net interest margin and deposit are the most important factors that determine the risk taking behavior of both joint and non-joint venture commercial banks of Nepal. Whereas, net interest margin is most important factor that determine the performance of Nepalese commercial banks. Based on the primary survey result, most of the credit department employees believe that long term existence is most important factor for risk and performance management.Banks are recommended to increase their risk taking behavior and performance as much as possible for the long term existence in the Nepalese market.Likewise, the primary survey results indicate that bank’s risk taking behavior and performance evaluation is highly affected by default of credit, loan and advances, determining suitable frequency of risk taking behavior and performance appraisal and implementation of feedback program regularly as the most important methods for reducing risk and increasing the performance in Nepalese commercial banks. The recommendation put forward by this study is that banks are suggested to invest their volume of deposit and asset in safer side with maximum return as possible for reducing risk and increasing the better performance. The major limitation of this study lies in the fact that this study has excluded some bank specific and macro-economic variables that might influence on risk taking behavior and performance evaluation of banks.The study remains enough ground for future researcher in the same topic. The future studies can be carried out by selecting other financial institutions like development banks, public banks and finance companies to grab the wider view of banks’ risk taking behavior and performance evaluation. Likewise, this study has conducted in Kathmandu valley so future studies are suggested to extend the survey outside the valley including all the department of employees. Risk taking behavior and performance evaluation of joint venture and non joint venture commercial banks of Nepal [printed text] / Niroj Maharjan, Author . - 2014 . - 114p. ; GRP/Thesis + 2/B. Including bibliography Languages : English Descriptors: Banks Banks and banking Commercial banks Risk taking behavior Risk-taking (Psychology) Keywords: 'risk taking behavior  banks  banks and banking commercial bank  nepal' Class number: 155.9 Abstract: Despite of several empirical evidences, bank’s risk taking behavior and performance evaluation issues are still unsolved in the context of Nepal. Identification of banks’ risk taking behavior and factors shaping the performance of bank is crucial for the Nepalese commercial banks. The major objective of this study is to analyze the risk taking behavior and performance evaluation of Nepalese commercial banks. The review of literature has shown relationship between various factors such as growth of loan, investment, total assets, return on assets, gross domestic product, capital adequacy ratio and leverage. In addition, leverage, total assets, loan, investment and non-performing loan to total loan are some of the variables that are found to have significant relationship with risk taking behavior and performance of banks in various contexts. Based on the literature reviews, this study has proposed the conceptual framework identifying volume of loan, investment and return on assets and some of other variables as the most important factors that determine the risk taking behavior and performance evaluation of commercial banks in the context of Nepal. This study is based on primary as well as secondary data. For the purpose of study 19 commercial banks which are established before 2007/08 are divided into two strata (joint venture and non-joint venture) is taken as sample. Required data of dependent variables (loan, investment, and return on assets) and independent variables (leverage, deposit, non-performing loan to total loan, net interest margin, debenture and bond, total assets, capital adequacy ratio, gross domestic product and inflation rate.) are collected from various secondary sources for the period of 2007/08 to 20011/12. Primary survey questionnaire is conducted in order to assess the opinion of bank’s risk taking behavior and performance evaluation of Nepalese commercial banks. Likewise, multiple regression analysis and correlation analysis are used to examine the relationship between bank’s risk taking behavior and performance evaluation and its determinants. The study reveals that volume of debenture and bond, deposit and total assets are some of the variables that are found to have significant relationship with the risk taking behavior of joint venture banks in various contexts. Similarly, non-performing loan to total loan, leverage, total assets, inflation and net interest margin are some of the variables that are found to have significant relationship with the risk taking behavior of non-joint venture banks in various contexts. Net interest margin and total assets has significant relationship with performance evaluation in both joint and non-joint venture banks. Based on the study, total assets, non-performing loan tot total loan, net interest margin and deposit are the most important factors that determine the risk taking behavior of both joint and non-joint venture commercial banks of Nepal. Whereas, net interest margin is most important factor that determine the performance of Nepalese commercial banks. Based on the primary survey result, most of the credit department employees believe that long term existence is most important factor for risk and performance management.Banks are recommended to increase their risk taking behavior and performance as much as possible for the long term existence in the Nepalese market.Likewise, the primary survey results indicate that bank’s risk taking behavior and performance evaluation is highly affected by default of credit, loan and advances, determining suitable frequency of risk taking behavior and performance appraisal and implementation of feedback program regularly as the most important methods for reducing risk and increasing the performance in Nepalese commercial banks. The recommendation put forward by this study is that banks are suggested to invest their volume of deposit and asset in safer side with maximum return as possible for reducing risk and increasing the better performance. The major limitation of this study lies in the fact that this study has excluded some bank specific and macro-economic variables that might influence on risk taking behavior and performance evaluation of banks.The study remains enough ground for future researcher in the same topic. The future studies can be carried out by selecting other financial institutions like development banks, public banks and finance companies to grab the wider view of banks’ risk taking behavior and performance evaluation. Likewise, this study has conducted in Kathmandu valley so future studies are suggested to extend the survey outside the valley including all the department of employees.

Hold

Place a hold on this item

Copies

Barcode	Call number	Media type	Location	Section	Status
50/D	155.9 MAH	Thesis/Dissertation	Uniglobe Library	Philosophy & Psychology	Available

---

page 1/1