Analysis of individual and organisational factors on loan decision performance among bank officers / Natalia Hakimi

Frequent occurrences of fraud cases involving the banking institutions have triggered an alarming concern, especially on the loan application issues. There were numerous reported incidences involving bank officer's poor judgement which can irreparably tarnish the banking profession. Due to the incidences involving the loan fraud cases in the banking sectors, it has led to the issues involving bank officers' loan decision performance to be fore fronted and closely scrutinized. In the banking profession, the risk judgement and decision-making are complex processes because the processes have to undergo the bank officer's fiduciary obligation to their clients, banking regulations by the institutions itself and regulation set-up by Bank Negara Malaysia (BNM). The purpose of this study is to examine the effect of competency, internal control, teamwork, information technology support, data security and fraud indicators intensity on the loan decision performance. Based on The Behavioural Decision Theory (BDT), this study addresses these shortcomings by taking into account the combined effect of internal and external factors on the loan decision performance of the bank officers. A survey method with a total respondent of 234 bank officers, had been used in this study. Overall, the results through the analysis of Partial Least Squares (PLS) of Structural Equation Modelling had confirmed the effect of the internal and external factors in influencing the bank officers' loan decision performance.