Credit Risk Management and Interest Income of Banks in Nigeria
Fapetu Oladapo (),
Seyingbo Oluwagbenga Abayom () and
Owoeye Segun Daniel ()
Additional contact information
Fapetu Oladapo: Department of Banking & Finance, College of Management Sciences, Federal University of Agriculture
Seyingbo Oluwagbenga Abayom: Department of Finance, University of Ilorin, Kwara State, Nigeria
Owoeye Segun Daniel: Department of Banking & Finance, College of Management Sciences, Federal University of Agriculture
Computational Methods in Social Sciences (CMSS), 2017, vol. 5, issue 1, 23-35
This study examines the impact of credit risk on the interest income of banks in Nigeria between the period of 2000 and 2014. Unbalanced panel data analysis was used to estimate the model with unit root test, Breusch Pagan test, trend analysis, descriptive statistics, Perasan CD Test, heteroskedasticity test, heterogeneity test, serial correlation test, Jarquebera, F-statistics, random effect, fixed effect, time effect, Prob value, Hausman test and rho as the estimation parameters. The study discovered that NPL, LLP and LA are statistically significant in explaining the variation in interest income across banks in Nigeria, while LA/TD is not statistically significant in explaining the variation in interest income across banks in Nigeria. Based on this, the study recommends that regular update of credit policy and adequate measures to monitor loans should be put in place by banks in Nigeria, as these measures will reduce bad loans and ultimately cause a reduction in loan loss provisions., 23-35
Keywords: Credit risk; non-performing loans; interest income; return on asset; risk management (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed
Downloads: (external link)
http://cmss.univnt.ro/wp-content/uploads/vol/split ... _issue_1_art.003.pdf First version, 2017 (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: http://EconPapers.repec.org/RePEc:ntu:ntcmss:vol5-iss1-17-23
Access Statistics for this article
Computational Methods in Social Sciences (CMSS) is currently edited by Bogdan Oancea
More articles in Computational Methods in Social Sciences (CMSS) from "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences Contact information at EDIRC.
Series data maintained by Stefan Ciucu ().