Risk Management In Nigeria Banking Industry
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Date
2014
Authors
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Journal ISSN
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Publisher
IISTE.Org
Abstract
The research paper examined the risk management in the Nigerian banking industry. First bank of Nigeria PLC
was used as the case study being the oldest and the biggest bank out of the twenty- three (23) banks currently
operating in Nigeria economy.
The data used for the study were collected majorly from primary source through the distribution of
questionnaires to respondents in the bank. Simple percentages were used to analyze the respondents’ responses
to each of the question while Chi- square (
) and the Analysis of Variance statistic (ANOVA) were used to test
the stated hypothesis.
The analysis revealed that risk in the likelihood of fraud and forgery, operational risk, market risk and system
risk abound in the Nigeria banking operations which needed to be managed appropriately in order to improve
performances and profitability of the banks.
Based on the research findings, it was discovered that Nigeria banking operations are affected more by credit
risk and operational risk than market risk. Fraud and forgeries also play adverse role in banking daily operations.
However, the risk management techniques put in place by the banks have really curbed or reduced the various
risks confronting Nigeria banks.
It was therefore recommended among others that Nigeria government should strengthen the legal framework for
the enforcement of loans repayment from borrowers to banks upon loan maturity. And that financial regulator
must adopt risk management approach that is in complete compliance with international standards focusing on
the financial and operational risks faced by banks so as to guide against any risks associated with the banking
operations and existence.