HAYAT MUHAMMED2025-06-262025-08https://rps.wku.edu.et/handle/123456789/46377This study assesses the factors contributing to non-performing loans (NPLs) at the Commercial Bank of Ethiopia's Yejoka branch in Wolkite, addressing the growing concern of NPLs in the banking sector amidst economic challenges. The main objective is to identify key factors influencing NPLs, evaluate bank-specific characteristics, and assess the effectiveness of current credit assessment practices. Utilizing a mixed-methods approach, the research combines quantitative data from structured surveys with qualitative insights from interviews with branch managers. Major findings indicate that economic conditions, such as inflation and unemployment, significantly affect borrowers' repayment capabilities, while borrower characteristics, including credit history and income stability, are also crucial. The study recommends enhancing credit assessment procedures, improving loan monitoring systems, and fostering better interdepartmental communication to mitigate risks associated with NPLs.enThesis