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The impact of credit risk management policies on the growth of deposit money banks: the Nigerian experience

Guardado en:
Publicado en:International Journal of Research in Business and Social Science vol. 14, no. 3 (2025), p. 253-265
Autor principal: Fadun, Olajide Solomon
Otros Autores: Ijımakınva, Babajide Abayomi, Obi, Ever
Publicado:
Society for the Study of Business and Finance
Materias:
Nigeria
Default
Banking industry
Credit risk
Ratios
Risk assessment
Financial information
Data analysis
Risk management
Standard scores
Banks
Random sampling
Financial institutions
Inflation
Bankruptcy
Rating services
Hypotheses
Correlation analysis
Research design
Financial statement analysis
Bank management
Literature reviews
Credit scoring
Loans
Money
Collateral
Regression analysis
Statistical analysis
Credit
Operational definitions
Credit policy
Sampling
Risk factors
Banking
Statistics
Acceso en línea:Citation/Abstract
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Resumen:This study examines the impacts of credit risk management on the growth of Nigerian banks. Specifically, the study focused mainly on the impacts of credit risk management among Deposit Money Banks in Nigeria. The study employed an ex-post facto research design, utilizing secondary data from the financial information of 14 selected listed Deposit Money Banks from 2007 to 2022. The study population was defined as the total number of listed Deposit Money Banks, from which a sample of six banks was selected using a simple random sampling technique. The operationalization of variables included (1) the use of natural logarithm for bank size, (2) a three-level scale for credit risk, and (3) alternative measurements for collateral management and credit scores. Data analysis involved the calculation of descriptive statistics, correlation analysis, variance inflation factors, and regression analysis. The research hypotheses are also validated to assess the significance of various factors in credit risk management. The findings revealed that credit scores significantly enhance the effectiveness of credit risk assessment, and collateral management did not significantly contribute to mitigating credit risk. The findings also revealed that default risk management significantly reduces the credit risk of Deposit Money Banks in Nigeria. These results highlight the intricate nature of credit risk management in the banking sector and emphasize the need for a multifaceted approach.
ISSN:2147-4478
DOI:10.20525/ijrbs.v14i3.4161
Fuente:ABI/INFORM Global