A study on loan portfolio management of Commercial Bank of Ceylon, PLC: an evaluation

Abstract

This report is based on “A Study on Loan Portfolio management of Commercial Bank of Ceylon, PLC: An Evaluation” that is made from experience of working in Credit Admin Department of CBCL. At present, In Bangladesh Banks and Financial Institutions facing some problems especially in credit management as a result some banks are at the verge of ruin because of their huge non-performing and classified loans. Therefore banks are becoming very competitive as various kinds of services and products launched and availed by financial institution are increasing with rapid growth due to in such a small market where 57 Banks and more than 33 NBFIs are chasing too few customers. People and corporate need money to accommodate their livelihoods as well as upgrade with the present status of living; therefore people and corporate take Loan and advances from the bank anytime during their life this loan amount which is funded by pooling money from public saving in exchange of interest. This is why all banks including commercial bank mobilize and channelize their funds with great cautious. This report focuses on different loan portfolios funded and provided By Commercial Bank of Ceylon. The main objectives of the report are identifying the different types of loan portfolios and their overall management and performance in the last few years. Both primary and secondary sources of data have been used to materialize this report. The first part of this report is organization part which covers organizational overview including its brief history from date of inception, mission, vision, activities, core business and last five years highlights. Second part of the report is project part that covers introductory part which includes introduction, objective, scope, limitation and the rest of the report encompasses literature review, methodology, analysis, findings, recommendations, conclusions and references. Although Commercial Bank of Ceylon is under foreign commercial bank category, It plays a vital role to accelerate and contribute a lot to the economic growth and activities of the country by extending loans and diversifying its credit portfolio by financing substantial amount of loans in SMEs, Garments, Textile and Spinning, Steel and Engineering, Paper and Paper Products Food and Food Processing, Wholesale and Retail Trading sectors and so on since its inception and renamed in 2003 as CBCL. In the recent years the Bank emphasizes on lending to SMEs and export oriented industries. The major task for a bank is to succeed in the competitive environment of credit service by managing its loan portfolio in an efficient and effective way. And commercial bank of Ceylon manages the loan portfolio in effective way and earns success and prosperity consistently. It operates in a disciplined and prudent manner with focusing on driving productivity initiatives with delivering sustainable improvements in business performance.