The macro effect towards credit risk / Siti Maryam Sujak

Credit risk has been always been a primary concern for financial institution to maintain its performance. Therefore financial institution will develop a mechanism to monitor and measure the factor that contributed to credit risk. The global financial crisis which is started in year 2007 has exposed that the existing of risk management systems among financial institution still fragile. Due to that issue, this research is attempting to study on macroeconomics factor towards credit risk determinants. This study has two major purposes including to identify the most macro variable factors that determined the credit risk and to determine the relationship between macroeconomic variables towards credit risk. Nonperforming loan as a dependent variable for credit risk related with independent variables that included real GDP growth, interest rate, inflation and unemployment. The data had taken from year 1997 to 2014 from World Bank in Malaysia.