Effect of Credit Management on the Liquidity Position of Money Deposit Banks (a Case Study of First Bank Nigeria Plc, Access Bank Plc and Zenith Bank Plc)

ABSTRACT
The study sought to evaluate the effect of credit management on the liquidity position of firms in Nigeria using First Bank Nigeria, Zenith bank and Access bank Plc as the case study. The objectives of this study are: to analyse the effect of credit policy on liquidity management in deposit money banks is Nigeria, to determine the significant relationship between liquidity position and debtors’ turnover of deposit money banks in Nigeria and to determine the relationship between liquidity management and profitability of deposit money banks in Nigeria. The research was carried out by analyzing the financial statements of the selected bank over the period of 2014 to 2023 with the aid of E-view. The results were analysed through descriptive statistics and least linear regression model. The study revealed that the money deposit banks can manage liquidity and profitability through credit policies, the debtors’ collection period affects the liquidity of money deposit banks in Nigeria which implies that a favorable debtors collection period would result to favorable liquidity position and that improper management of liquidity reduced the profitability of money deposit banks. This implies that for firms to maximize their profit, they should grant credit to trustworthy customers with an appropriate credit control mechanism. Finally, this study recommends that deposit money banks should monitor, review and adjust credit policy from time to time considering the nature of their business and mission, deposit money banks should increase the rate of credit sales to trustworthy customers because credit sales is a marketing tool to maintain or expired sales and there is need for deposit money banks should to maintain adequate liquid assets and eliminate bad debt losses and other associated costs of credit.