In business transaction, granting of credit facilities is
quite universal. It is an acceptable method of financial business transaction
and activities. Granting credit facilities to customers is a practice that
cannot be avoided as long as business is concerned, to some sensitive sectors
of the economy like banking industry, granting of credit and loans constitute
their major earning that means, the larger the credit facilities, the fatter
the interest receivable at the same time poor assessment and analysis of credit
can be devastating. The risk not withstanding, granting of loans and credit
facilities enhances economic growth and development of any nation credit
provides the lubricant for continuity of transaction regardless of the
immediate available cash. The choice of the topic is to evaluate how effective
credit analysis can be utilized to ensure survival of the national economy and
grow of banking industry. The analysis of credit and loan management practice
of Fidelity Bank Plc, my case study is taken through the analysis of retrieved
data and personal interview with some management and of the bank.
Credit financing could be seen as back backbones of the
economy. This is because one can hardly see any business transaction without
the mechanism of credit.
As financial intermediaries, banks have the function of
procession, these facilities in form of loans and advances, to the deficit
units of the economy to ensure equitable distribution of resources development
of the real manufacturing agricultural etc loans and advances are geared to
acids industrialization and development especially in an economy like ours,
which is characterized by low capital base, inflation, low pre capital income
and other unfavourable Economic indications.
Banking lending through the most profitable activity of the
bank industry, is the most risky venture that is undertaken by the banks.
Hence, excellence in the field of lending and credit
management is excellence in the fields of lending and credit management is
essentially through practical experience. The key to successful lending for
business is a systematic credit analysis, which deals with the process of
investing those factors that give rise to non payment of debts. The efficiency
of credit decision shall b all standards depend upon sound judgments of the
officer or manager.
Hence to succeed, the lending officer must combine expertise
and flexibility in appraisal of individuals application it is against this
background that credit analysis and loan management of fidelity bank plc is
evaluated to determine it impact in the economic development of the nation.
1.1 BACKGROUND OF THE
work is essential for efficient credit and loan management in the banking
industry. This is because of the problems it has created. In the banking
industry which has led to non compliance by some banks to the credit guidelines
of the Central Bank of Nigeria (CBN). Above all, given global economy these are
a need to address the issue.