ABSTRACT

The topic of the research study is the impact of accounting information on banks' lending decisions and the PUFPOSC of the study is to review the impact ol' accounting information on banks' leciding decisions. The work was carried out through the administration of questionnaires, oral interview and observation recorded by the researcher. The population of the study consisted of eighty (80) member staff and customer's of Access Bank of Nigeria Plc, Umuahia Branch, and the sample size is sixty seven (67) by using Yaro's statistical formular. Data collections were collected through the use of primary data and secondary data. Granting of loans and advances to those that need such including business oiganizalions is one of the most piotilab%e iir'estments of coTrmleTcial bank. Such loans enhance profitability of such organization and help them execute such projects which their capital cannot finance. This research work is tailored towards finding out the role played by financial accounting information in lending decisions making of the banks. The main objective of the 'study is to examine the impact of accounting infonnation on banks' lending decisions. The hypothesis testing of study includes; banks always demand lbr borrowers' linancial statements before taking decisions. Accounting information has no significant effect in bank's lending decisions. Adequate use of accounting information has not contributed to reduction in the incidence of bad debts. From the findings, it is seen that accounting information is important in bank's lending decisions. Conclusion, banks make adequate use of accounting information in making decisions, although the extent to which they use the financial statement differ from one bank to another. Thus, the financial statement required from customers is profit and loss account, balance sheet and sometimes fund flo-w statement. Recommendation, banks should intensify their demand on the customers providing accounting information when they are making proposals for loans. Banks should also demand for collateral security from their customers to ensure that borrowed loans are paid as at when due.