Treasury Management Strategies and Bank Performance

Abstract

This study examines the impact of treasury management on the financial performance of Nigerian commercial banks, focusing specifically on how treasury risk management, operational risk management, and credit risk management influence Return on Assets (ROA). A descriptive research design was adopted to analyses data from twenty-eight commercial banks listed on the Nigerian Exchange Group, allowing for a systematic assessment of observable patterns between treasury management strategies and financial outcomes. The model specification employed ROA as the performance indicator, with the three risk management dimensions serving as explanatory variables. Findings reveal that credit risk management, operational risk management, and treasury risk management each exert a positive and significant effect on ROA, indicating that banks with stronger risk control frameworks achieve superior financial performance. The study concludes that effective treasury management is essential for enhancing profitability and sustaining financial stability within the banking sector. It recommends that banks strengthen credit risk assessment systems, improve internal operational controls, and adopt more robust treasury management practices such as proactive liquidity planning and asset–liability management to optimize overall performance.