Evaluation on Cost and Schedule overrun of Project Financing: a Case Study on Commercial Bank of Ethiopia
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Date
2020-06
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Addis Ababa University
Abstract
Finance is one of the inputs for the development of the economic supplied mostly
by the financial sector. Project financing is funding of a particular investment unit
in which a lender is convinced to look initially to viability in marketability,
technical aspects, and financial, environmental friendly and sound project
management. As CBE(Commercial Bank of Ethiopia ) . Align with this the
research was undertaken with the objective of evaluating forecasted cost and
time completion overrun of projects financing by Commercial Bank of Ethiopia.
The study deployed quantitative and qualitative research approach; descriptive
design to construct meaning from extracted data collected from primary and
second sources through survey and document review Accordingly, the study
came up with the findings that factors CBE was facing in project financing
emanate from three determinate factors namely the lender .Promoter and
external environment. The study, hence, concluded project financing challenges in
CBE were external environment specific (data/information, financial
intermediaries, economic & political environment and infrastructure), borrower
specific (character of the borrower, nature of the project and management
problem of the project promoter) and bank related (character of the bank, credit
policy and procedure and credit appraisal & approval) in decreasing order of
mean value of major category. From the reached conclusion in the study, it is
recommended the bank and concerned parties should take respective actions to
tackle the challenges timey.
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Keywords
nature of the project and management, objective of evaluating forecasted cost, major category, concerned parties