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" Operational Risk Management Practices and Financial Performance of Micro Finance Banks in Kwara State, Nigeria "
Adegoke, Mujeeb
Onaolapo, Abdulrahman
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Latin Dissertation
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| Language of Document
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English
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| Record Number
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1057011
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| Doc. No
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TL56128
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| Main Entry
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Adegoke, Mujeeb
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| Title & Author
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Operational Risk Management Practices and Financial Performance of Micro Finance Banks in Kwara State, Nigeria\ Adegoke, MujeebOnaolapo, Abdulrahman
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| College
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Kwara State University (Nigeria)
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| Date
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2020
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| Degree
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M.S.
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| student score
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2020
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| Note
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125 p.
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| Abstract
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Operational risk is one of the major obstacles that affects financial performance of micro finance banking institutions in Nigeria. Several procedures and measures have been put in place to ensure proper management of operational risk in micro finance banking system.However, micro finance banks’ exposure to this particular risk have greater effect on their financial performance in Nigeria. Based on this, this study provides empirical investigation on the operational risk management practices and financial performance of micro finance banks in Kwara State. Specifically, this study seeks to:(i) examine the relationship between internal process risk management and financial performance of micro finance banks in Kwara State.(ii) ascertain the relationship between technology risk management and micro finance banks’ financial performance in Kwara State.(iii) determine the effect of personnel risk management on financial performance of micro finance banks in Kwara State.(iv) assess the effect of compliance risk management on financial performance of micro finance banks in Kwara State. In order to achieve these objectives, survey research design was adopted with total population of 155 from which 112 were picked as a sample size. Partial Least Square Structural Equation Method (PLS-SEM) was used in achieving the study objectives. The findings revealed that internal process risk management (β=0.212, t>1.96), technology risk management (β=0.311, t>1.96), personnel risk management (β=0.210, t>1.96) and compliance risk management (β=0.517, t>1.96) have significant positive effect on the financial performance of micro finance banks in Kwara State. This implies that any positive changes made to these factors will result in a positive change on the financial performance of micro finance banks in Kwara State. Therefore, the study concluded that operational risk management practices is positively related to the financial performance of micro finance banks in Kwara State. Based on this, the followings are recommended; building strong internal control in order to eradicate failure in the management process of micro finance banks. Also, adoption of new technology, provision of manual back up in case of system failure. More so, there should regular training of existing staff on operational risk exposure. Finally, government and regulatory bodies need to issue out prudential guideline for operational risk management practices to the microfinance banks and ensure its compliance.
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| Descriptor
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Banking
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Finance
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Onaolapo, Abdulrahman
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Kwara State University (Nigeria)
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