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Determinants of Commercial Banks Lending Decision in Ethiopia: A Case Study on Selected Private Banks.

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dc.contributor.advisor G/Medhin, G/Hiwot
dc.contributor.author Dereje, Tsegaye
dc.date.accessioned 2018-10-08T07:35:15Z
dc.date.available 2018-10-08T07:35:15Z
dc.date.issued 2018-06
dc.identifier.uri http://localhost:80/xmlui/handle/123456789/12465
dc.description A Thesis Submitted to The College of Business & Economics of Addis Ababa University in Partial Fulfillment of the Requirements for the Degree of Master of Business administration in Finance. en_US
dc.description.abstract Loan portfolio is the largest asset and source of revenue for banks. Therefore, its administration requires considerable skill and dexterity on the part of the bank management. The main objective of this study was to identify the determinants of lending decision of private commercial banks in Ethiopia. In order to achieve the research objectives, data was collected from a sample of ten private commercial banks over the period from 2009 to 2017. Bank specific and macroeconomic variables were analysed by using the balanced panel random effect regression model. Nine variables that affect banks’ lending decision were selected and analyzed with E-views version 9. Estimation results showed that bank size(BSIZ), real GDP growth rate(GDP) and exchange rate (EX) were positive and statistically significant while investment portfolio, volume of deposit, liquidity ratio and inflation rate were found to be statistically significant with negative effects respectively on total loans and advanced by private commercial banks in Ethiopia. However, credit risk ratio and cash reserve requirement ratio were statistically insignificant at all levels with positive and negative effects on private commercial banks lending decision respectively. Therefore, private commercial banks should adjust their lending decision in response to the signals from these factors, such that positive signals like bank size(BSIZ), real GDP growth rate(GDP) and exchange rate (EX) in this study make banks become more favorably disposed to lending and vice versa. en_US
dc.language.iso en_US en_US
dc.publisher Addis Ababa University en_US
dc.subject Bank size en_US
dc.subject Deposit en_US
dc.subject Exchange rate en_US
dc.title Determinants of Commercial Banks Lending Decision in Ethiopia: A Case Study on Selected Private Banks. en_US
dc.type Thesis en_US


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