This report investigates the effects of recoverable and non-recoverable loans on bank lending behavior in the UK, using the Lloyds Banking Group as a case study. The research, employing a descriptive research design and quantitative methods, examines the influence of various factors such as credit terms, credit limits, and interest rates on lending practices. The study, based on the portfolio theory of lending and the theory of planned behavior, analyzes the relationship between loan types and banks' lending behavior. The findings reveal a positive relationship between recoverable loans and lending behavior, while no significant relationship was found between non-recoverable loans and lending behavior. The report also highlights the impact of high-interest rates on loan defaults. The study employed a sample of 80 respondents from four departments within the bank, using self-administered questionnaires and statistical analysis to derive its conclusions.
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