Contribution of loan management to Financial performance of commercial bank CASE OF ACCESS BANK PERIOD: (2019- 2022)

Abstract

the purpose of this study was to assess contribution of loon management to the financial performance of commercial bank. case study of ACCESS Bank, period: 2019 – 2022’’. The specific objectives are to determine the effectiveness of loan management in access bank and to assess the contribution of loan management on the financial performance of access bank. . The study used a descriptive research design in which both qualitative and quantitative techniques were utilized. The population of this study comprised members in Service department and Loan department ,Accounting department , Managers and also clients of Access bank was 80 Members, Sample size comprised of 15 Members of Access Bank. The researchers were used and purposive sampled by believing that they provided the information required. Both primary and secondary sources with their relevant tools like questionnaire, documentary in order to come up with required data. performances of access bank Rwanda were analyzed and results demonstrate that, the ratios of net profit margin from 2019 up to 2022 were 6.20%; 20.14%; 15.21% and 30.49% respectively. and in the same period the ration of return on asset were0.51%; 1.46%; 1.15% and 2.51% respectively. and from 2019- 2022 the ratio of return on equity were 5.11%; 10.04%; 7.92% and 17.26% respectively. The relationship between two variables also was assessed through the proportion of interest income to total income and results shows that interest income every year dominate at the rate of above 65%. This, prove that loans are effectively managed and contribute to the overall financial performance since these interest income are sourced from loans granted. Therefore, it is from the above results researchers conclude that Access bank Rwanda applied loan management effectively and that it positively contribute to the overall performance of this bank.