NON-PERFORMING LOANS AND PROFITABILITY OF PRIMARY MORTGAGE BANKS IN NIGERIA 2012-2023

Authors

  • Chukwu, Kenechukwu Origin
  • Patrick Mbanefo
  • Ozobialu Ezimma Doris

Keywords:

Non-Performing loans and profitability of primary mortgage banks in Nigeria.

Abstract

This study examined the effect of non-performing loans (NPL) on the profitability of primary
mortgage banks in Nigeria from 2012 to 2023. Utilizing time series data from the Nigeria
Deposit Insurance Corporation's annual report for 2023, the research investigated how
variables such as NPL, capital adequacy ratio (CAR), and loan-to-deposit ratio (LDR)
influence return on assets (ROA). Auto-regressive distributed lag models (ARDL) were
applied for the analysis, revealing that while non-performing loans had a negative effect,
this effect was statistically insignificant over the study period. The study suggests that
primary mortgage banks should focus on enhancing credit risk management, optimizing
loan recovery strategies, diversifying their loan portfolios, improving capital adequacy,
ensuring regulatory compliance, and investing in technology and data analytics to
strengthen their operational and financial resilience.

Author Biographies

  • Chukwu, Kenechukwu Origin

    Department of Banking and Finance,NnamdiAzikiwe University Awka

  • Patrick Mbanefo

    Department of Banking and Finance,NnamdiAzikiwe University Awka

  • Ozobialu Ezimma Doris

    Department of Banking and Finance,NnamdiAzikiwe University Awka

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Published

2024-11-25

How to Cite

NON-PERFORMING LOANS AND PROFITABILITY OF PRIMARY MORTGAGE BANKS IN NIGERIA 2012-2023. (2024). Journal of the Management Sciences, 61(7), 88-106. https://journals.unizik.edu.ng/jfms/article/view/4630

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