Poor Credit Risk Management and Bank Failures in Nigeria

Abstract

The study was designed to evaluate the relationship of poor credit risk management and bank failures in Nigeria and propose strategies for remedial actions. Credit risk management is one of the most crucial banking functions that involve the appraisals of requests for banking facilities. It is critical to bank survival or failure because banks traditionally earn their huge profits from interest on their risk exposures. The survey research design was adopted and researcher’s self designed instrument was used to generate data for the study. Chi-square statistic method was used for data analysis. It was found that poor credit risk management influences bank failures. Literature also provided credible evidence to show that weak corporate governance accelerates bank failures. Ten (10) recommendations were made based on the findings of the study.