Risk Management Strategies as Determinants of Sustainability in Deposit Money Banks Within Ibadan, Oyo State, Nigeria

Adewale. O. Taiwo PhD; Olamide. A. Olanipekun

doi:10.56201/jafm.vol.12.no2.2026.pg38.53

📄 Download Paper

Risk Management Strategies as Determinants of Sustainability in Deposit Money Banks Within Ibadan, Oyo State, Nigeria

Adewale. O. Taiwo PhD, Olamide. A. Olanipekun

Abstract

This study examined Risk Management Strategies as Determinants of Sustainability in Deposit Money Banks within Ibadan, Oyo State, Nigeria. The main aim was to investigate how credit risk management and liquidity risk management influence the long-term sustainability of banks in the region. Specifically, the study sought to assess the effect of credit risk management on sustainability and examine the relationship between liquidity risk management and sustainability. The research adopted a descriptive survey design, targeting branch managers, risk officers, and accountants from ten selected deposit money banks. A total of 120 questionnaires were distributed, and 110 valid responses were analyzed using regression and correlation analyses with the aid of SPSS version 26. Findings revealed a significant positive effect of credit risk management on bank sustainability (? = 0.642, t = 6.215, p < 0.001), while liquidity risk management exhibited a moderate positive relationship with sustainability (r = 0.518, p < 0.01). The combined model showed that both variables jointly explained 54% (R2 = 0.54) of the variance in sustainability, indicating that sound risk management frameworks enhance institutional resilience and operational efficiency. The study concluded that effective credit appraisal systems, prudent liquidity control, and strong governance structures are essential for the sustainability of deposit money banks. It recommended that banks strengthen their risk management systems, maintain adequate liquidity buffers, and comply with regulatory standards to ensure long-term stability and competitiveness.

Keywords

Banking sectorCredit risk managementLiquidity managementRisk managementSustainability. Word count: 228

References

Adebayo, T. O., & Lawal, K. S. (2022). Institutional size and adoption of risk management practices among deposit money banks in Nigeria. Journal of Banking and Finance Research, 14(2), 87–99. https://doi.org/10.37256/jbfr14202287 Adetunji, A. M., & Olawale, L. F. (2023). Risk governance structures and financial sustainability of commercial banks in Sub-Saharan Africa. Journal of Sustainable Finance & Investment, 13(1), 55–73. https://doi.org/10.1080/20430795.2023.2171083 Afolabi, J. A., & Olatunji, T. E. (2024). The mediating role of corporate governance in risk management and bank performance in Nigeria. International Journal of Economics and Business Studies, 12(2), 102–118. https://doi.org/10.28945/ijebs1242102 Aina, K. O., & Adekunle, B. M. (2021). Liquidity risk and the performance of deposit money banks in Nigeria: A post-recapitalization analysis. Journal of Accounting and Financial Management, 17(3), 72–89. https://doi.org/10.20448/jafm1737289 Chinweuba, A. E., & Ijeoma, N. B. (2024). Liquidity management and financial sustainability of commercial banks in Nigeria. International Journal of Financial Management Studies, 9(1), 45–59. https://doi.org/10.31871/ijfms914559 Eze, C. J., & Nwosu, J. O. (2023). Risk management practices and organizational sustainability of Nigerian banks. Journal of Contemporary Banking and Finance, 8(4), 203–219. https://doi.org/10.52941/jcbf84203219 Ibrahim, M. T., & Yusuf, S. L. (2022). Credit risk management and profitability of listed deposit money banks in Nigeria. Journal of Financial Risk and Management, 15(2), 98–113. https://doi.org/10.3390/jfrm1502098 Ifeanyi, P. U., & Danjuma, M. (2025). Enterprise risk management and long-term sustainability of financial institutions in Nigeria. African Journal of Management and Policy Studies, 6(1), 33–50. https://doi.org/10.48171/ajmps615033 Okafor, C. I., & Oladipo, O. A. (2023). Integrated risk management and operational efficiency of Nigerian banks. African Journal of Accounting and Finance, 11(3), 210–228. https://doi.org/10.2478/ajaf-2023-0310 Oladimeji, O. R., & Ekwueme, C. P. (2022). Risk mitigation techniques and the sustainability of financial institutions in Nigeria. Nigerian Journal of Economics and Development, 20(1), 141–157. https://doi.org/10.4314/njed.v20i1141 Owolabi, A. A., & Ajayi, S. O. (2023). Credit risk management and sustainability performance of deposit money banks in Nigeria. International Review of Economics and Business Research, 15(4), 134–150. https://doi.org/10.32782/irebr1542023134 Uche, C. E., & Bello, O. R. (2024). The impact of Basel III regulations on risk management efficiency and sustainability in Nigerian banks. Journal of Financial Regulation and Compliance, 32(2), 89–107. https://doi.org/10.1108/JFRC-12-2023-0123

Risk Management Strategies as Determinants of Sustainability in Deposit Money Banks Within Ibadan, Oyo State, Nigeria

Abstract

Keywords

References

More Articles from JOURNAL OF ACCOUNTING AND FINANCIAL MANAGEMENT