| dc.description |
The main objective of this study was to assess risk management practices used by
commercial banks in Tanzania. The study used both second and primary data in both
qualitative and quantitative techniques. The study used both stratified and purposive
sampling techniques. Primary data was collected through interviews, observation and
questionnaires from six bank employees and administrators. The banks involved include
NMB Bank, CRDB Bank, BACLAYS Bank, NBC Bank, EXIM Bank and DTB Bank.
For Secondary data, the study used documentary review. Data was collected during the
month of July, 2014 using the questionnaires which were distributed to 100 respondents.
Of these 80 respondents returned the questionnaires, giving a respondent rate of 80
percent.
The study indicates that commercial banks continue to find it difficult to manage risks,
as most commercial banks appear to be caught in a vicious cycle that moves between
rapid growth in the ‘good’ times and virtual standstill when a crisis hits back. Findings
indicate that all focused banks do constantly apply risk management procedure for
example; risks mitigation manuals, proper monitoring and supervision of banking
operation. The findings further concluded that
risk management policy, employee
involvement and management practice have significant effect on the risk management
practice in commercial banks. But also, the findings showed that profitability has weak
significant influence on the risk management practice.
Based on the foregoing findings; it is recommended that mutual understanding is
needed so that, all parties should speak a common language and communicate more
effectively. Business executives should be positioned to assess their company’s
enterprise risk management process against a standard, and strengthen the process and
move their enterprise toward the established goals. Future research can be leveraged off
an established base. Legislators and regulators will be able to gain an increased
understanding of enterprise risk management, including its benefits and limitations.
With all parties utilizing a common enterprise risk management framework, these
benefits will be realized. |
|