The Impact of Credit Risk Management in Financial Market Indicators—Analytical Study in the Iraqi Market for Securities

Mahdi Attia Jubouri

doi:10.4236/jfrm.2018.73017

Abstract

The objective of this study was to determine the relationship between credit risk management and financial market indicators. The study problem is summarized as follows: Do credit risk management indicators affect financial market indicators in private banks? The study relied on two basic hypotheses: the existence of a significant and significant correlation and effect relationship between credit risk management and financial market indicators. The sample of the study was a sample of private commercial banks in Iraq consisting of eight banks. The required information was obtained through the annual reports of the sample banks, as well as through the official publications of the Iraqi Stock Exchange for the period (2007-2016). The study used the program (Microsoft Excel 2013) in addition to the statistical methods found in the statistical program (SPSS V.23), and the importance of the study that it emerged out of the intellectual basis of the nature of the variables of the study based on the practical reality of the variables and the ability of these variables to achieve the goals. The study reached a number of conclusions, the most prominent of which was the existence of a difference between the banks in the relationship of correlation and impact between the variables of the study, and the study also reached a set of recommendations and suggestions.

Highlights

IntroductionThe importance of the study is to re-examine risk management practices applied by financial institutions
The problem of research can be shown more clearly by raising the following question: Do credit risk management indicators affect financial market indices (EPS, price ratio to profitability, share turnover, market value added) in private banks sample research operating in Iraq?
2) The study showed the analysis of some important factors in the process of credit risk management and the identification of indicators that show the objectives in banks

Summary

Introduction

The importance of the study is to re-examine risk management practices applied by financial institutions. Such as, facilitate financial transactions, provide liquidity, engage in asset transfers, and in the process, face significant risks. Financial institutions are often highly leveraged, financing a large part of their operations of debt. Current regulations focus almost entirely on asset risk, ignoring in practice the financial risks arising from the bank’s debt structure and financial responsibility.

Objectives

Methods

Findings

Conclusion