EFFECT OF NON-PERFORMING LOANS ON PROFITABILITY OF NIGERIAN DEPOSIT MONEY BANKS

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Date

2017-10-16

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Department of Banking and Finance, Nasarawa State University, Keffi.

Abstract

This study investigates effect of non-performing loans on profitability of Nigerian deposit money bank. The challenges posed by incidences of non-performing loans on profitability of deposit money banks is alarming, posing great risks to the capital adequacy and deposit liabilities of these banks. Data were collected from financial reports of these banks and analyzed by the use of multiple regression. Findings show positive relationship between capital adequacy ratio, deposit portfolio and non-performing loans of deposit money banks. It is therefore recommended that capital adequacy ratio of microfinance banks be increased in order to make them able to absolve shocks of non-performing loans and other associated credit default risks among others.

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Keywords

Deposit money banks, non-performing loans, capital adequacy, deposit portfolio

Citation

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https://keffi.nsuk.edu.ng/handle/20.500.14448/916

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