International Journal of Research in Finance and Management
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E-ISSN: 2617-5762|P-ISSN: 2617-5754

International Journal of Research in Finance and Management

2022, Vol. 5, Issue 1
Credit risk and performance of banks in Nigeria

Emmanuel IKPE Michael and Ekwere Raymond Enang

The study assessed the impact of credit risk on the performance of banks with international authorisation in Nigeria. The study covered 10 banks and adopted panel data research design for the period spanning 2006 and 2018. Non-performing Loans (NPLs), Loans Loss Provision (LLP) and Loans and Advances of the banks were regressed against Return on Asset (ROA) and Return on Equity (ROE) of the banks. Both FEM and REM were used in discussing the results of the analysis. For hypothesis one, none of the explanatory variables showed significant relationship with ROA in both FEM and REM. In hypothesis two, LLP and LAA showed significant relationship with ROE in FEM while NPL and LLP showed significant relationship with ROE in REM. NPL showed a positive relationship with ROE in both FEM and REM. It was recommended that regulators should be watchful and check banks’ excesses which tend to create a positive relationship between NPLs and ROE.
Pages : 16-24 | 120 Views | 71 Downloads
How to cite this article:
Emmanuel IKPE Michael, Ekwere Raymond Enang. Credit risk and performance of banks in Nigeria. Int J Res Finance Manage 2022;5(1):16-24. DOI: 10.33545/26175754.2022.v5.i1a.129
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International Journal of Research in Finance and Management