Abstract:
Banking industry is one of the largest sector in current world, with branches
and subsidiaries throughout everyone’s life. However, commercial banks are
facing risks when they are operating. Credit risk is the one of the significant
risk that banks face, considering that granting is one of the main source of
income in commercial banks in Sri Lanka. There for the management of the
risk related to that credit affect the Performance of the banks. The main
purpose of the research is to investigate if there is a relationship between credit
risk management and Performance of commercial banks in Sri Lanka.
Research model, ROE and ROA are measurement tools of Performance and
CAR, NPLR, LR and CIR are defined as tools of credit risk management. The
population of this study is 24 commercial banks in Sri Lanka, and 11
commercial banks will be identified as the sample. The analyze has been made
the credit risk management and its impact on profitability capacity during
2006 to 2015 (10 years) financial year of commercial banks in Sri Lanka. The
research data will be collect from annual reports of sample banks. Correlation
and multiple regression analysis are used for analysis. The findings reveal that
positive relationship between credit risk management and performance. And
also credit risk management is significant impact on performance of
commercial banks in Sri Lanka.
