Factors Affecting Loan Repayment Performance Of Borrowers In The Case Of Dashen Bank Addis Ababa District

The loan is a single largest asset in banks’ balance sheet. Thus, it’s essential to learn about thernfactors that affect this asset. However; some of the loan given out become non-performing or endrnup in default and adversely affect the financial performance of commercial banks.rnDashen bank A.A district currently provides different types of loan to its customers. But its nonperformingrnloan rate is becoming high and high comparing to the previous periods.rnAlthough different studies were undertaken to find out the different factors that contributed forrnnon-performing loans most of them concentrated on micro finance which can’t be generalized tornthe bank context in addition to this new factors like effect of covid 19 and corruption wasrnincluded in the study.rnThe general objective of the study is to identify and explain how and which client, lender andrnbusiness characteristics affect loan repayment performance of Dashen bank A.A districtrnborrowers.rnIdentifying factors that affect successful loan repayment will help Dashen Bank to be aware ofrnthe current factors influencing loan repayment performance and reformulate appropriate creditrnprogram.rnThere are many researches regarding repayment of loans, in Ethiopia as well as internationally.rnThe researcher’s states different empirical and theoretical literature reviews from differentrnperspective and titles. And Based on the objective of the study conceptual model has beenrndeveloped.rnThe research adopted descriptive research designing and it applied a qualitative and quantitativernresearch methodology. The quantitative data method will be employed to collect the primary datarnfrom the sample respondents in relation to the socio-economic characteristics of borrowers,rnbusiness factors and loan related factors.rnThe hosmer and lemeshow test result shows that 0.821 which means that the model is fit inrnaddition Nagelkerke R Square suggests that the model explains roughly 88.5% of the variation inrnthe outcome or all the 19 variables together or jointly explain 88.5% of loan repaymentrnperformance of a borrower by the model.rnThere are around 11 significant factors which can distinguishes credit worthy borrowers and notrncreditworthy borrowers, so scrutinize borrowers based on those factors and give the loan to thernone which have high rate comparing to the other borrowers.rnKeywords: borrowers, loan repayment, logistic mode

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