Assessment of credit facility management in commercial banks: the case study of Barclay’s banks (t) limited

This research has evaluated effectiveness of credit facility management at the Barclays Bank Tanzania Ltd (BBT LTD) basically on the performance and non-performance of their credit portfolio. Credit facility management is widely recognized as one of the most important aspect in any financial institution that calls for success in its business undertakings. The risks in credit have to be minimized to maximize banks returns. Specific objectives were, to see the effectiveness of credit facility management in attainment of organization goal, to assess to what extent the organization implements management of credit facility, how to improve on the collection of loans/overdrafts. A case study approach was adopted, using BBT LTD to provide answers to four research questions, these were; are the Policies and Procedures undertaken by the bank in processing and granting loans to customers adhered, do you have enough customers' information, is there strong Recovery Unit and why do borrowers fail to honor their obligations. The sample size used was 30 employees from different department of the bank and analysis was done by both qualitative and quantitative data. Data for measuring effectiveness of credit facility management were collected; tabulated; and analyzed using descriptive statistical approaches - the percentages in particular. The findings suggest that credit facility management at BBT LTD particularly in retail section is not effective. Basing on these findings and discussions, the following recommendations are brought to the attention of the top Management of BBT LTD; responsibilities towards credit risk management, credit assessment and recovery team, loans/overdrafts administration and number qualified staff, risk management culture and portfolio management, customers' information and interest rates and the government legal system to protect the interest of both borrowers and bankers.