Sewale, Abate (PhD)Sitina, Amino2018-11-042023-11-042018-11-042023-11-042018-06http://etd.aau.edu.et/handle/123456789/13726Msc Thesis submitted to College of Business and Economics of Addis Ababa University in partial fulfillment of the requirement for award of the degree of Master Science in Accounting and Finance Program.This study examines the bank-specific and macro-economic determinants of Non-performing loans (NPLs) of commercial banks in Ethiopia. Nine commercial banks have been the subject for the study ranging from 2007 to 2016. The bank's financial statement, National Bank of Ethiopia, central statistics agency and Ministry of finance and Economic Cooperation has been the main source for the study. The study employs an explanatory research design and a quantitative research approach moreover; a random effect model was used. The empirical results showed that trade openness positively and significantly affects non-performing loans, whereas, exchange rate, unemployment and loan growth affects NPLs negatively and significantly. Contrary to previous studies, the findings also showed an insignificant relationship of real lending rate, capital adequacy ratio and ownership structure with NPLs of Ethiopian commercial banks. The study suggests that, commercial banks should consider the macro economic factors before extending loans.en-USBank specific determinantsMacroeconomic determinantsNon-performing loansThesis