The effects of risk committee characteristics on bank asset quality

This paper examines the influence of risk committee characteristics on the asset quality of 21 banks in Nigeria for 2013-2022. Previous studies have largely ignored this nexus and presented defective results. However, this study uses data from 21 banks from Nigeria over a period of 10 years (from year 2013 to 2022). The study finds that, in general, risk committee characteristics positively influence asset quality and its individual components (except risk committee gender and meetings). The results show that there are differences in the role risk committees play in influencing asset quality in Nigeria. Thus, this study highlights the importance of risk committee in strengthening firm’s asset quality. The study also highlights the need to assess risk committee characteristics separately, in addition to the overall component, when conducting studies on the role of risk committee in asset quality of banks. Furthermore, regulators, shareholders, lenders, boards of directors, etc. would benefit from the findings of this paper. Note that these findings are restricted to banks in emerging economies as the results may vary in developed economies. Also, the results are valid based on the variables used and period coverage.