Abstract:
The purpose of the study was to examine the contribution of loan management on profitability of Bank of Kigali Ltd headquarter branch. The specific objectives of the study were to analyze the effectiveness of loan management provided by Bank of Kigali Plc and to find out if the loans management of Bank of Kigali Plc contribute to its profitability. The target population of this study was composed by 140 employees from internal audit, finance and business departments of bank of Kigali plc with sample size of 58. The Field data were collected using questionnaires and interview. For effectiveness of loan management in Bank of Kigali Plc, results shows that this bank use various techniques for effective loan management. After observing all findings what researcher can note here is that bank of Kigali plc applied loan management effectively. Regarding to the effectiveness of electronic banking in Bank of Kigali Plc results shows that this bank use various techniques for effective loan management. After observing all findings what researcher can note here is that bank of Kigali plc applied loan management effectively. Regarding to the effectiveness of loans management researcher realized that bank of Kigali plc apply Credit Terms, Credit Appraisal, Credit risk Control, Credit supervision and Credit collection and recovery policies. From 2021 up to 2023, the ratios of net profit margin were 35.98%; 31.23% and 33.35 respectively. This means that for RWF100, the bank got 35.98 Rwfs in 2021 and for RWF100, the bank got 31.23 Rwf in 2022 and for 100 Rwf invested, the bank got 33.35 Rwf in 2023. Therefore, these results show that Bank of Kigali Plc is profitable. From 2021 up to 2023, the ratio of Return on Assets are 2.95%; 3.22% and 3.53% respectively. This means that, in 2021 for 100 RWF of invested they got 2.95 RWF; in 2022 for 100 RWF of invested they got 3.22 RWF and in 2023 for 100 RWF invested Bank of Kigali Plc got 3.53 RWF. From 2021 up to 2023, the ratio of Return on Equity are as following: 18.16%; 18.72% and 20.42% respectively. This means that, for the 100 RWF invested in Bank of Kigali Plc, generated 14.86 RWF in 2021 and for the 100 RWF invested in Bank of Kigali Plc, generated 18.16 RWF, in 2022 for the 100 RWF invested in Bank of Kigali Plc, generated 18.72 Rwf and for the 100 RWF invested in Bank of Kigali Plc, generated 20.42 RWF of benefit in 2023.
