Effective Credit Administration As An Antidote To Corporate Failure

CHAPTER ONEINTRODUCTION1.0 Background to the StudyThe concept of credit can be traced back in history and it was not appreciated until and after the Second World War when it was largely appreciated in Europe and later in Africa (Kiiru, 2004). Credit risk management has been an integral part of the loan process in banking business. Credit risk is the current and prospective risk to earnings or capital arising from an obligor’s failure to meet the terms of any contract with the bank or otherwise to perform as agreed. (Kargi, 2011).When banks grant loans, they expect the customers to repay the pr…