AN ASSESSMENT OF CREDIT MANAGEMENT IN NIGERIA COMMERCIAL BANKS.

The purpose of this research is to examine the impact of credit management on commercial banks. The introduction of the prudential guideline in the banking industry, the volume and value of loans and advances classified into non-performing account have continued to increase in bank lending. Obviously, this has an adverse effect on banks since it affects their cash flow and impairs profitability. Most loans and advances go bad because of the inadequacy in credit management and recovery procedure of banks. Appraisal of lending vis a vis the credit management of banks and the impact of the application of prudential guidelines on credit form the major objective of this study. Union Bank of Nigeria Plc Okpara Avenue Enugu was used as a case study with a view to highlighting the effectiveness, the adequacy or otherwise of the credit management policy of Nigerian commercial banks with a view to finding the causes and consequences of non-performing loans and advances. The causes are excessive lending on security values and bad management of borrowers. Having analysed the data, the following findings were made, the principal objective of bank lending is to generate revenue, the loan-deposit ratio affects the liquidity position of commercial banks, non- performing account kept on increasing the frequent occurrence of non- performing accounts was discovered to be a result of the banks inability to put in place an effective process of loan recovery, implementation of prudential guidelines by Nigerian commercial banks reflect the real income of banks. In conclusion, the prudential guidelines reduced the profitability of commercial banks and made banks classify their loans clearly. In the recommendation, the researcher suggested that the provisions of the prudential guidelines should be adhered to and an effective loan monitoring unit should be set-up in al commercial banks.