Impact of Credit Risk Mamangement on Financial Performance of Listed Deposit Money Banks in Nigeria

This study investigate impact of credit risk management on the financial performance of listed deposit money banks in Nigeria over a period of ten (10) years 2014-2024.Credit risk remains one of the most critical risks faced by the banks, particularly in emerging economies with volatile financial markets most especially from defaults of non-payments by the borrowers. The main objective of the research is to evaluate how key credit risk indicators like performing Loans (NPL), Loan Advances (LA) and Loan Loss Provision (LP) influence profitability as measured by return on asset (ROA) and return on equity(ROE). The population for the study is all the deposit money bank while, the sample size was fourteen (14) out of all the deposit money bank. Findings from the study revealed that NPL was found to be negative but not significantly related to market performance of the listed deposit money banks in Nigeria. LLP was found to be positive and statistically related to market performance. The positive effect was attributed the presumption by managers that, lending business could be risky and could turn out to be bad. LA was found to have negative association between loans and advances and market performance of listed deposit money banks in Nigeria while capital adequacy was positively related to the sampled banks. It is therefore recommended that deposit money banks in Nigeria should enhance their capacity in credit analysis and loan administration while, regulatory authority should pay more attention to compliance to relevant provisions of the bank and other financial institutions Acts.