Effect of Credit Risk in 10 Commercial Banks in Adamawa State Nigeria

The goal of the research was to determine the influence credit risk on selected commercial banking in the context of Adamawa State, Nigeria. The study focused on a dataset consisting of ten commercial banks in Yola Adamawa from the year 2005 to 2023. The target population was 677 which include clientele and personnel of the context of the commercial banks. The study implemented random sampling to collect data from 245 respondents. This study considered return on asset (ROA) as a moderating variable to sharpen the firm's credit risk which in this context is defined as capital adequacy ratio (CAR), non-performing loan ratio (NPLR), loan loss provision (LLP) and Loans to deposit ratio (LDR). The study opted primary data collection through questionnaires. The study made use of descriptive and inferential statistical analyses for the study. A descriptive measure that was computed included the mean, median, and standard deviation, alongside regression analysis and hypothesis testing for inferential analysis. The outcome of the research indicates that most of the factors of credit risk positively influence the performance of the ten commercial banks being studied. Managers of these ten commercial banks are advised to implement proper credit risk management policies by identifying critical areas that require improvement for the banks’ longevity. In light of the above, the study, therefore, recommends that for these commercial banks credit risks should be managed through the adoption of adequate effective frameworks in the management systems and insurance policies coupled with adequate protective measures.