Risk management, diversification, and profitability of commercial banks in Central Africa

This article examines the impact of bank risks and diversification on the profitability of commercial banks in Central Africa. The results indicate that the credit risk and liquidity risk have a negative impact on the profitability of these banks. Moreover, credit risk is reduced more through credit...

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Bibliographic Details
Published in:	The Journal of corporate accounting & finance Vol. 33; no. 2; pp. 91 - 98
Main Authors:	Zogning, Félix, Lenga, Serge Didier
Format:	Journal Article
Language:	English
Published:	Hoboken Wiley Periodicals Inc 01-04-2022
Subjects:	bank diversification banking risks Central Africa Commercial banks Credit risk Diversification Liquidity liquidity risk profitability Risk management Central Africa
Online Access:	Get full text
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Summary:	This article examines the impact of bank risks and diversification on the profitability of commercial banks in Central Africa. The results indicate that the credit risk and liquidity risk have a negative impact on the profitability of these banks. Moreover, credit risk is reduced more through credit rationing than through an in‐depth examination of the borrowers’ profile. Lastly, banks use diversification to compensate for revenues lost because of credit rationing.
ISSN:	1044-8136 1097-0053
DOI:	10.1002/jcaf.22544