The relationship between credit risk, liquidity risk, interest rates, and inflation and profitability in other banks

The gap

Evidence profile

Sourced from the recommendations and inline gaps and limitations and future-work section of the source papers, classified as general, spanning 6 journals.

Supporting evidence — 6 representative gaps

• CHALLENGES ON LOAN RECOVERY AND PERFORMANCE OF MONEY DEPOSIT BANKS IN NIGERIA (2026) · International Journal of Financial Research and Management Science · doi

  Based on the findings of the study, it was recommended that deposit money Banks should include collateral review and enhance their credit risk architecture to always management, facility performance monitoring, quality reviews, classification and risk portfolio reporting. Banks’ credit granting decisions should be based on the results of the risk assessment, client’s solvency, available collateral, and transaction compliance with policies. REFERENCES Al-Eitan G. N. &Tareq O. B. (2019). Credit Risk and Financial Performance of the Jordanian Commercial Banks: A Panel Data Analysis. Academy of Accounting and Financial Studies Journal 23(5), 1-13 Altman, E. I. (2020). Altman high yield bond and default study. U.S.: Fixed Income High Yield Report. Al-Eitan G. N. &Tareq O. B. (2019). Credit Risk and Financial Performance of the Jordanian Commercial Banks: A Panel Data Analysis. Academy of Accounting and Financial Studies Journal 23(5), 1-13 Amene, T. B., &Alemu, G. A. (2019). Determinants of financial performance in private banks: A case in Ethiopia. African Journal of Business Management, 13(9), 291-308. Adelakun, O. J., & Misra, S. (2018). Corporate Governance and Credit Risk in the Nigerian Banking Industry. Banks and Bank Systems, 13(4), 64-74. Anaemeje, A. C (2007). Banking and FinanceFederal Reserve Bank of St. Louis. (2020). The relationship between unemployment and default on credit cards and other credit products. Ayoola, A. A., & Adegbite, E. (2021). Impact of Agribusiness Financing on Agricultural Productivity in Nigeria. Journal of Economic and Sustainable Development, 12(2), 33-42. CBN (2019). CBN Monetary, Credit, Foreign Trade and Exchange Policy Guideline for 2011 Fiscal Year. Monetary Policy Circular 31. Chen, K. & Pan, C. (2022). An Empirical Study of Credit Risk Efficiency of Banking Industry in Taiwan. Web Journal of Chinese Management Review, 15(1), 1-16. Epure, M. & Lafuente, I. (2012).Monitoring bank performance in the presence of risk.Barcelona GSE Working Paper Series, 61. Goldstein, M. & Turner, P. (2019). Banking Crises in Emerging Economics: Origins and Policy Options. BIS Economic Paper, 46. Hale, R. H. (2022). Credit Analysis – A Complete Guide. New York: Wiley Inter science Publication. Kithinji, A. M. (2020). Credit Risk Management and Profitability of Commercial Banks in Kenya, Nairobi. Unpublished Thesis School of Business, University of Nairobi. Kargi, H. S. (2019). Credit risk and the performance of Nigerian banks. Zaria: Ahmadu Bello University Press TIJFRMS E-ISSN 3027-2866 P-ISSN 3027-1495 136 MAY, 2026 EDITIONS. INTERNATIONAL JOURNAL OF: FINANCIAL RESEARCH & MGT. SCIENCE VOL. 12 Kola, F. K., & Akinpelu, A. O. (2020). Microfinance Institutions' Loan Portfolio and Sustainable Development in Nigeria. International Journal of Mic

  generalrecommendations
  Keywords: credit risk banks journal performance financial management banking commercial bank policy based collateral review monitoring
• Credit Risk Management and Financial Performance: Evidence from Listed Deposit Money Banks in Nigeria (2026) · Zenodo (CERN European Organization for Nuclear Research) · doi

  The recommendations are presented in line with the three specific objectives of the study. The study found that the Non-Performing Loan Ratio (NPL) has a negative but statistically insignificant effect on Return on Equity. Although the effect was not significant, rising non- performing loans remain a potential threat to banks' profitability and financial stability. Therefore, it is recommended that listed Deposit Money Banks should strengthen their credit appraisal procedures, borrower screening mechanisms, and loan monitoring systems to minimize loan defaults. Banks should also deploy advanced credit risk assessment tools, early warning systems, 398 AMERICAN JOURNAL OF MULTIFUNCTIONAL PUBLISHING Volume – 3 | Issue – 7 |2026|ISSN: 2997-3287 and regular loan portfolio reviews to detect distressed loans promptly and improve loan recovery rates. The findings revealed that the Cash Reserve Ratio (CRR) has a positive and statistically significant effect on Return on Equity. Based on this result, it is recommended that Deposit Money Banks should continue to maintain prudent liquidity management practices and comply fully with the Central Bank of Nigeria's cash reserve requirements. At the same time, bank management should efficiently manage the portion of funds available for lending and investment to maximize profitability without compromising liquidity. The Central Bank of Nigeria should also formulate reserve requirement policies that promote financial system stability while allowing banks sufficient flexibility to support productive lending activities. The study established that the Solvency Ratio has a negative and statistically significant effect on Return on Equity. Consequently, it is recommended that bank management should maintain an optimal solvency level that satisfies regulatory requirements while ensuring efficient utilization of financial resources. Rather than holding excessive capital in low-yield assets, banks should allocate resources to quality, income-generating investments that enhance shareholders' returns without compromising long-term financial stability. Regulators should also encourage capital optimization strategies that strengthen resilience while supporting sustainable profitability. References: 1. Addou, K. I., Boulanouar, Z., Anwer, Z., Bensghir, A., & Ramadilli Mohammad, S. M. (2024). The impact of basel III regulations on the solvency and credit risk-taking behavior of Islamic banks. International Journal of Islamic and Middle Eastern Finance and Management, 17(5), 915–935 2. Adesola, O., & Oyeniran, I. A. (2026). Credit risk management and financial deposit money banks in Nigeria. International Journal performance of of Research and Innovation in 8678–8691.

  generalrecommendations
  Keywords: banks loan financial management effect credit bank ratio statistically return equity significant profitability stability recommended
• The Impact of the Sustainable Financing Ratio on Credit Risk and Profitability of KBMI IV Banks in Indonesia for the Period 2015 - 2025 (2026) · West Science Journal Economic and Entrepreneurship · doi

  Limitations of this study include the limited number of subjects in four banks, the use of NPL and ROA as the sole proxies for credit risk and profitability, the failure to include all internal and external factors that can influence bank performance, and differences in the availability and consistency of Sustainable Financing disclosures between banks and between periods.

  generalinline gaps
  Keywords: include banks limitations limited number subjects four sole proxies credit risk profitability failure internal external
• Non-Performing Loans and Profitability of Deposit Money Banks in Nigeria (2026) · IIARD INTERNATIONAL JOURNAL OF BANKING AND FINANCE RESEARCH · doi

  1. Bank management should enhance risk management strategies and strengthen loan recovery processes to mitigate the impact of non-performing loans on profitability. Implement advanced monitoring systems to detect early signs of loan defaults. 2. Regulators should develop and enforce stricter guidelines for loan provisioning and risk management to ensure banks maintain adequate buffers against potential losses. Regularly review and update regulatory frameworks to address emerging financial challenges. 3. Investors should monitor banks' non-performing loan metrics and their impact on profitability. Use this information to make informed investment decisions, focusing on institutions with robust risk management practices and effective asset quality control. IIARD – International Institute of Academic Research and Development Page 42 IIARD International Journal of Banking and Finance Research E-ISSN 2695-1886 P-ISSN 2672-4979 Vol 12. No. 6 2026 www.iiardjournals.org REFERENCES Admati, A. R., & hellwig, M. F. (2013). The bankers' new clothes: what's wrong with banking and what to do about it. Princeton university press. Akinola, H.O. (2015). Capital adequacy and bank performance in Nigeria. Journal of Economics, 34(9), 12-19. Altunbas, Y., Carbo, S., Gardener, & Molyneux, P. (2007). Examining the relationships between capital, risk, and efficiency in European banking. European financial management, 13(1), 49-70. Balogun, K. (2020). Bank lending and bank performance in nigeria. Journal of Accounting and fianace 12(2), 37-49. Basel Committee on Banking Supervision. (2006). International convergence of capital measurement and capital standards. Bank for international settlements. Basel Committee on Banking Supervision. (2010). Basel iii: A global regulatory framework for more resilient banks and banking systems. Bank for international settlements. Berger, A. N., & Bouwman, C. H. S. (2013). How does capital affect bank performance during financial crises? Journal of financial economics, 109(1), 146-176. Berger, A. N., & Deyoung, R. (1997). Problem loans and cost efficiency in commercial banks. Journal of banking & finance, 21(6), 849-870. Berger, a. N., & Mester, l. J. (1997). Inside the black box: what explains differences in the efficiencies of financial institutions? Journal of banking & finance, 21(7), 895-947. Brown, K., & moles, P. (2014). Credit risk management. Edinburgh business school, heriot-watt university. Bushman, R. M., & Williams, C. D. (2012). Accounting discretion, loan loss provisioning, and discipline of banks’ risk-taking. Journal of accounting and economics, 54(1), 1-18. Caprio, G., & klingebiel, D. (2003). Episodes of systemic and borderline financial crises. World bank research dataset. CBN. (2018). Annual report. Central bank of Nigeria. Chen, X., Skull

  generalrecommendations
  Keywords: bank banking journal management risk financial loan banks international capital finance performance nigeria economics accounting
• EVALUATING FINANCIAL SOUNDNESS AND PERFORMANCE OF INDIAN PUBLIC SECTOR BANKS USING THE CAMEL FRAMEWORK: A COMPARATIVE ANALYSIS (2026) · EPRA International Journal of Economic and Business Review · doi

  This study examines only five selected public sector banks over the period 2016–2025 using secondary data sources. The analysis is restricted to financial ratios and descriptive statistics. Factors such as economic conditions, policy changes, customer perceptions, managerial technological developments are not included, which may influence overall performance outcomes. practices, and 9. FINANCIAL AND STATISTICAL TOOLS The study employs financial ratio analysis and statistical techniques to evaluate bank performance. Financial tools include Capital Adequacy Ratio, Debt-Equity Ratio, NPA Ratios, ROA, ROE, Net Profit Margin, Current Ratio, Business per Employee, and Credit-Deposit Ratio. Statistical tools such as Mean, Standard Deviation, Coefficient of Variation, and CAGR are utilized.

  generallimitationsevidence 5/5
  Keywords: ratio financial statistical tools epra public sector banks period ratios economic performance capital adequacy business
• Analysis of the Influence of Credit Risk, Liquidity Risk, Interest Rates, and Inflation on Profitability at BPR Bank Bogor City (2026) · Journal Research of Social Science, Economics, and Management · doi

  Future studies can examine the relationship between credit risk, liquidity risk, interest rates, and inflation and profitability in other banks. Future studies can investigate the impact of other factors on bank profitability. Future studies can use different methodologies to analyze the relationship between these variables.

  generalfuture-work sectionevidence 5/5
  Keywords: future studies examine relationship between credit risk liquidity

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