CREDIT MONITORING AND LOAN PORTFOLIO PERFORMANCE AT DFCU BANK UGANDA LIMITED

<p>The study sought to examine the relationship between credit risk monitoring and loan portfolio performance in DFCU Bank. The study was guided by the following objectives: to examine the relationship between credit monitoring and the loan portfolio performance of DFCU Bank. A cross-sectional survey research design was used. The study predominantly employed a quantitative approach but also used a qualitative approach. The study population consisted of 140 participants from 15 branches of DFCU Bank located in Kampala. A sample size of 103 was selected using Morgan and Krejcie's Table (1970). A purposive sampling technique and simple random sampling were used to choose respondents. Quantitative data analysis mainly consisted of descriptive statistics (percentages) and inferential statistics (Pearson correlation, coefficient of determination). Content analysis was used to analyze qualitative data. Findings revealed that there is a significant relationship between credit monitoring and loan portfolio performance in DFCU Bank. It was concluded that the more credit risk management practices are provided in DFCU Bank, the better the loan portfolio performance. It was thus recommended that DFCU bank should therefore assess long term plans of loan applicants to identify future needs and risks of their businesses, the bank should also focus on assessment of the prevailing economic conditions facing the client’s business, analyze clients’ track record of bank loan repayment as these can affect client loan repayment hence leading to a better loan portfolio performance of DFCU Bank.</p><p> </p><p><strong>JEL:</strong> B26, E51, E58, G21</p>