Economics and Business
ISSN 2775-9237 (Online)
Published: 03 April 2018
Non-Performing Loans and Banks’ Performance in Nigeria: Evidence From First Bank Nigeria Plc
Valentine Ogudo, Babatunde Afolabi
Afe Babalola University, Nigeria
Download Full-Text Pdf
In recent past, many Nigerian banks became weak and highly unprofitable due to high non-performing loans portfolio accumulated by the banks. It is widely believed that the major reason for the huge non-performing loan portfolio can be attributed to insider dealing due to excessive and collaterised loans to bank directors that eventually became bad and irrecoverable. The study seeks to examine the effects of Non-performing loans on the performance of the banking sector in Nigeria. The exploratory research design was adopted in the study. The result of the analysis showed that high level of non-performing loans reduces the performance of banks in the long run in Nigeria. The study, therefore, recommends amongst other things that credit reporting and supervising authorities should be enhanced to stem the ugly tide of the high level of non-performing loans in the Nigerian banking sector.
Ajakaiye, O. and Fakiyesi, T. (2011). Global financial crisis discussion series: Nigeria.Overseas Development Institute, (Paper 8): 122 – 152.
Amaonwu, O. E. (2009). Risk qualification International conference on risk management, Enugu Nigeria 19-23 March 2009 pp 1-16
Balogun, E. D. (2007). A review of Soludo's perspective of banking sector reforms in Nigeria. MPRA Paper 3803, University Library of Munich, Germany (38): 58 – 102.
CBN (2010) Prudential Guidelines for Deposit Money Banks July 2010
Esan, E.O. and Okafor R.O. (2000). Basic Statistical Methods, Lagos Jas Publishers.
Ikono, A. W. (2008). Appraisal of banking consolidation in Nigerian financial sector (2004 – 2007). Unpublished MBA Thesis submitted to the Department of Business Administration. Lagos State University, Ojo, Lagos
Irukwu, J.O (2002). Accident and Motor Insurance in West Africa, Ibadan: The Caxton Press.
Lucey, T. (2011), Quantitative Techniques, 3rd ed. New York: Guernesey Press ELBS Edition.
Mueller, P.H. (1999). Lending Officers and Lending, 4thed. New York: Harper & Row.
Nwankwo, G.O. (2009), Bank Management: Principles and Practice, Lagos: Malt house Press Ltd
Onyeriuba, L.O. (2000). Economic Policy and Economic Development in English Speaking Africa, Lagos: Malt house Press Ltd.
Ojikutu, R. K., (2012) Statistics: Problems and Solution, Ikeja: Malt house Press Ltd.
Osuagwu, L. (2000) Business Research Methods, Principles and Practice, Lagos: Gray Research Ltd.
Sanusi,S.L. (2012). Banking reforms and its impact on the Nigerian economy, Paper presented at Warwick’s Economic Summit, UK, 17TH February, 2012.
Soludo, C.C. (2009) Global financial and economic crisis: how vulnerable is Nigeria? Presentation by Professor Charles Chukwuma Soludo, Governor of the Central Bank of Nigeria, (in office between May 29, 2004 – May 29, 2009) to the House of Representatives Committee on Banking and Currency on January 21, 2009.