Personal factors affecting the probability of overdue debt of individual customers at Bank for Agriculture and Rural Development of Vietnam, Tay Do branch

Abstract

In order to provide more view of using personal credit risk measurement tools at Vietnamese commercial bank branches, this study collected data from 386 individual customer profiles of Agribank - Tay Do branch and applied logistic regression technique. The results show that 8 factors including Age, Marital status, Education, Collateral, Income before loan, Income after disbursement, Loan term, Credit history have statistically significant influences on personal credit risk with the model's explanatory level of 82.6%. The study also made recommendations for Agribank - Tay Do branch in particular and Vietnam's commercial bank branches in general to use logistic regression model and to attach importance to income and credit history factors instead of focusing too much on collateral elements in measuring personal credit risk.