Preprint Article Version 1 This version is not peer-reviewed

Financial Performance Analysis of Distressed Banks in Ghana: Exploration of Financial Ratios and Z-score

Version 1 : Received: 25 November 2019 / Approved: 26 November 2019 / Online: 26 November 2019 (10:58:44 CET)
Version 2 : Received: 29 November 2019 / Approved: 29 November 2019 / Online: 29 November 2019 (11:23:43 CET)

How to cite: Juabin, M. Financial Performance Analysis of Distressed Banks in Ghana: Exploration of Financial Ratios and Z-score. Preprints 2019, 2019110314 (doi: 10.20944/preprints201911.0314.v1). Juabin, M. Financial Performance Analysis of Distressed Banks in Ghana: Exploration of Financial Ratios and Z-score. Preprints 2019, 2019110314 (doi: 10.20944/preprints201911.0314.v1).

Abstract

A robust bank industry is a major player in the stability of an economy. By way of financial ratios and Z-score, the study analysed UT Bank’s financial performance prior to the recent bank sector reforms. Annual financials over a four year period were used. Debt management practices of UT Bank per the results obtained were quite on the hind side. Leverage and risk variables were poorly handled. UT Bank would have been unable to meet creditors’ claims considering the mean average values of debt-to-assets and debt-to equity ratios of 0.76 and 0.90 respectively. The entire bank sector will be put on sound footing on if credit management practices of individual banks are refreshed. The bank industry regulator should tighten its supervisory and monitoring role over banks to help detect early signs of non-performing banks. The study further recommends that statutory lending limits of banks be re-enforced to uphold the threshold of 10 percent for unsecured loans and 25 percentage for secured loans of net owned funds of the bank.

Supplementary and Associated Material

Subject Areas

Bank, Debt, Distress, Performance, Credit Management Practice, Z-score

Comments (0)

We encourage comments and feedback from a broad range of readers. See criteria for comments and our diversity statement.

Leave a public comment
Send a private comment to the author(s)
Views 0
Downloads 0
Comments 0
Metrics 0


×
Alerts
Notify me about updates to this article or when a peer-reviewed version is published.