Management of Credit Risk in Banks and its Growth for Sustainable Development in Africa: Evidence from Nigeria
1Ezema Clifford Anene and 2Okere Mercel
1Department of Insurance and Risk Management, Faculty of Management Science, Nigeria
2Department of Insurance and Actuarial Science, Imo State University, Owerri, Imo State, Nigeria
Email: Clifford.ezema@esut.edu.ng; okeremarcel@imsuonline.edu.ng
ABSTRACT
This study examined management of credit risk in banks and its growth for sustainable development in Africa. Evidence from Nigeria. Risk Management practice for the purpose of this study was centered to credit risk while output growth was centered on earnings per share of shareholders Its specific objectives are: to determine the Capital adequacy ratio and Liquidity risk ratio of banks on earnings per share of shareholders from 2014 and 2024 using multiple regression model adopted for data analysis. The result indicated that Capital adequacy ratio has a positive but statistically non – significant effect on Earnings per share with PV = 0.2927, Coefficient = 2.114684 while liquidity risk ratio has positive but not statistically significant effect with PV = 0.0918, Coefficient = 28.28475 on Earnings per share of deposit money banks in Nigeria. The implications are that variations in Capital Adequacy does not have a meaningful effect on shareholders earnings while Liquidity Risk may affect shareholders earnings but the effect is not substantial enough to be considered significant at conventional levels. Based on the findings it was recommended among others that banks should carefully manage their lending practices, diversify their lending opportunities and match loan growth with risk management principles so as to maximize shareholders returns
Keywords Credit risk, Earnings per share, Capital adequacy ratio and Liquidity ratio.
CITE AS: Ezema Clifford Anene and Okere Mercel (2025). Management of Credit Risk in Banks and its Growth for Sustainable Development in Africa: Evidence from Nigeria. NEWPORT INTERNATIONAL JOURNAL OF CURRENT RESEARCH IN HUMANITIES AND SOCIAL SCIENCES, 5(3):8-18. https://doi.org/10.59298/NIJCRHSS/2025/5.3.818000