Risk Management in Nigerian Banking Industry: A Case Study of the Union Bank PLC

Abstract

This study aims to investigate risk management practices in the banking sector of Nigeria, with a specific focus on Union Bank PLC. It was decided to use a survey research design for this investigation. The goal is to investigate the state of risk management in Nigeria's financial sector. The city of Abuja has been chosen as the location for the research. Union Bank Plc staff and customers in Abuja, FCT, Nigeria, were randomly chosen as the study's population. From the total number used to establish the sample size, 2,600 individuals were randomly chosen to participate in the survey. Taro Yamane's formula was used to calculate the population sample size since it is easy to understand. The sample size, therefore, is 347 respondents. Both primary and secondary data were used to complete this research. The questionnaire is structured in accordance with the aims. Each goal will be the basis for a set of questions. SPSS (statistical software for the social sciences) was used to run the nonparametric statistical test (Chi-square) to check the hypothesized relationships between variables. The acquired data was examined using Freq tables, %, and mean score analysis. Then the study discovered Union Bank PLC had demonstrated a commitment to effective risk management by implementing various risk management practices that have helped to mitigate the risks associated with its operations. The study has also identified some challenges that Union Bank PLC faces in its risk management practices, such as inadequate staffing, lack of adequate technology infrastructure, and inadequate training and development of staff. Among others, the study recommends that it is necessary to strengthen the risk management framework: Union Bank PLC should continue to strengthen its risk management framework to ensure that it covers all areas of its operations. The bank should conduct a comprehensive review of its risk management framework to identify any gaps or weaknesses. Based on the findings of the review, the bank should develop and implement a plan to strengthen its risk management framework. The plan should include regular updates to risk management policies, procedures, and guidelines. The bank should also ensure that its risk management framework is aligned with international best practices and regulatory requirements. The bank should consider adopting a risk-based approach to its operations, which involves identifying, assessing, and mitigating risks before they materialize.