Impact Of Accounting Information On Bank Lending Decision In Nigeria (A Case Study Of Selected Banks In Abia State)

ABSTRACT

Considering the high incidence of bad debts and consequently bank failures, it is imperative that adequate accounting information is obtained by lending banks to enable them (banks management) have a hedge against customer default. lnfomation is considered as an important tool in all decision making situations. As a result, financial institutions should benefit from accounting information, which the customers are capable of providing. An ahalysis of accounting information by banks is very vital in their lending decision. For the fact that a lot of banks have failed because of credit failures, many people believe that the cause of these credit failure is as a result of improper analysis of accounting information by prospective borrowers. It is also feared that if nothing is done the situation may get worse. This work is aimed at achieving amongst others. 1. Ascertaining if banks make adequate use of accounting • information presented by their customers to determine the credit worthiness of such customer: 2. Ascertaining the range at which the financial accounting infärmation presented by potential borrower influences bank lending decisions, and also to make findings and recommendations which might help the banks in improving their lending decisions.