Sound credit underwriting: Does it undermine growth?
This paper explores the relationship between credit underwriting standards and loan growth for the Malaysian banking industry and selected banks using correlation and trend analysis. The paper also attempted to identify whether there were any differences between local banks and foreign banks using...
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| Main Author: | |
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| Format: | Monograph |
| Language: | English |
| Published: |
Universiti Utara Malaysia
2009
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| Subjects: | |
| Online Access: | http://repo.uum.edu.my/2451/1/Sound_Credit_Underwriting-Does_It_Undermine_Growth.pdf http://repo.uum.edu.my/2451/ |
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| Summary: | This paper explores the relationship between credit underwriting standards and loan growth for the Malaysian banking industry and selected banks using correlation and
trend analysis. The paper also attempted to identify whether there were any differences between local banks and foreign banks using the Paired-Samples T-Test. It
was found that sound credit underwriting practice generally undermines loan growth.However banks employing superior loan technology are able to achieve high loan growth without compromising credit standards with the use of proper loan technology.Although local banks appear to outperform the foreign banks both in terms of loan
growth and NPL, further studies involving a larger pool of local and foreign banks are needed before generalisation could be made. |
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