ASSESSMENT OF LOAN RECOVERY PERFORMANCE ON THE CASE OF DEVELOPMENT BANK OF ETHIOPIA

Abstract

This study is carried out as an assessment of loan recovery performance in development of loan recovery performance in development bank of Ethiopia. The study is based on primary data collected through questionnaires survey from 118 employees working in loaning unit of bank the study also would be uses secondary data collected from financial statement, quarterly reports, annual reports credit policy, & procedure descriptive research proposal method will be used employed to identify the loan recovery performance of the bank. the assessment result shows that the loan repayment period. assessment of customer credit history collateral estimation project follow up monitoring & controlling system delays to decide on non-performing loan has affected the loan recovery performance of the bank the study is of crucial importance to measure whether DBE does were adequate polices & procedures manual whether the credit unit verifies outstanding liabilities of the borrowers before additional &new loan are granted, the existence & adequacy of feasibility study whether the bank would be a proper way of gathering credit information internally & externally , inadequate credit policies & procedures manuals , unrealistic loan repayment period . in efficient analysis of customer financial statement & absence of well-designed project follow-up system are the major finding , recommend the bank to exert maximum efforts to be up dated and review the credit policies and procedures manual frequency as the policies and procedures of the bank are out ted &do not consider the current situation. Further more. The bank loan. repayment period should consider the nature and cash flow of the project in order to collect the loans as per the repayment schedule instead of performing based on assumption &in terms of loan period .at the final points , the bank should give prior attention to the human resource development through short term training job rotation & experience sharing. Particularly creating awareness is relation to analysis of customer financial statement is crucial since analysis of the financial statement of borrowers is an important means to obtain information about how the borrowers operated in the previous period. the study would be help to enhance the efficiency & effectiveness of loan administration operation &provide different methods &ways to safe guard assets (primary loan) adequacy & accuracy of its loan review function promote to comply with management policy procedure, applicable laws & regulation,